Pacific Ethanol Inc., the Sacramento-based marketer and producer of low-carbon renewable fuels, says it has entered into agreements to reduce the principal amount of its senior notes by $2 million by issuing 500,000 shares of common stock.
PEI’s debt-reduction move was accompanied by announced agreements to increase the company’s ownership in its production facilities to 91 percent.
PEI has been gradually increasing its ownership stake in production facilities, part of a process that began with a 2009 bankruptcy filing by PEI’s production subsidiaries.
The local firm said its common stock in the newly announced move is valued at $4 per share, the closing price last Friday. PEI said reducing the principal on the senior notes by $2 million means that the company will avoid scheduled interest rate increases, locking in an annual rate of 5 percent for the remaining term of the notes.
The company said upping its stake in PEI production facilities is being implemented via agreements to purchase 6 percent of additional ownership interests in New PE Holdco LLC for $500,000.
Call The Bee’s Mark Glover, (916) 321-1184.