Drax Group announced on Wednesday (10-5-22) that it has agreed to acquire the remaining 10% minority interest in Alabama Pellet LLC joint venture from Two Rivers Lumber Co. LLC. for a cash consideration of $22 million (USD). The transaction is expected to be completed by the end of October 2022.
Drax Group is a UK-based renewable energy company engaging in renewable power generation through production of sustainable biomass.
According to the press release, Alabama Pellet LLC. is comprised of the Aliceville and Demopolis pellet plants. Aliceville, which was commissioned in 2018, has a production capacity of 300,000 metric tons per year. Demopolis, which was commissioned in 2022 and is co-located with a Two Rivers sawmill, has a production capacity of 360,000 metric tons per year.
The acquisition will provide Drax with a net economic control over an additional 66,000 metric tons of sustainable biomass production capacity per year, as well as rights over land associated Demopolis and extended long-term fiber supply arrangement.
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