One of the nation’s largest producers of renewable fuels is under new ownership.
Renewable Energy Group shareholders voted Monday to approve Chevron’s proposed acquisition of the company, bringing the biofuels giant under the umbrella of one of the most prominent oil companies in the world. The deal, first announced in February, is an all-cash transaction valuing REG at about $3.15 billion ($61.50 per share).
Mark Nelson, executive vice president of Downstream & Chemicals for Chevron, said the transaction will leverage “complementary capabilities, assets, and customer relationships to make Chevron one of the leading renewable fuels companies in the United States.”
A Chevron spokesperson confirmed all regulatory reviews are complete; the REG shareholder vote made the transaction final.
Cynthia “CJ” Warner, REG’s now-former president and CEO, will be appointed to Chevron’s board of directors effective today as part of the deal. Mike Wirth, Chevron’s chairman and CEO, said Warner’s “perspective and guidance will be invaluable as Chevron leverages its strengths to deliver lower carbon energy to a growing world.”
REG currently operates 11 biorefineries in the U.S. and Europe and has an annual production capacity of about a half billion gallons. The company made its first batch of biodiesel in 1996 and is today a leading producer of biodiesel and renewable diesel.
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Clean Fuels Alliance America — formerly the National Biodiesel Board — welcomed the news in a press release, with Donnell Rehagen, the group’s CEO, calling it a “meaningful acquisition for our industry.”
“REG has been a leader in our industry from its inception, being one of the very first companies to build a biodiesel plant in the United States,” he said. “This leadership in renewable fuels, coupled with the history and strength in the energy sector Chevron brings, will continue to build on the momentum our industry is experiencing as the country continues on its path of carbon reduction through cleaner fuels.”
According to Clean Fuels, the production capacity of the combined company is expected to produce 100,000 barrels of renewable fuels per day by 2030. REG’s Chad Stone will remain as the governing board chair for Clean Fuels.
REG will now be dubbed Renewable Fuels-REG under Chevron’s ownership and will continue to be located in Ames, Iowa.
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