Sale of bankrupt ethanol plant approved
A federal bankruptcy judge has approved the sale of Central Illinois Energy to Credit Suisse, the agent bank for financing of the unfinished ethanol plant.
The sale, which was approved Wednesday, is scheduled to close April 30.
The plant outside Canton was proposed in 2001. The project was delayed by design changes and problems raising money. Ground was broken on the 37-million gallon per year capacity plant in October 2006.
The project was financed with more than $90 million from Credit Suisse and the shareholders of Central Illinois Energy Cooperative, a group of 260 farmers who committed money and grain to the project.
The plant was nearly finished when contractors left the job site in November because they weren't getting paid. Most members of the Central Illinois Energy board of directors resigned shortly after that. The remaining two - Jay Sutor and Suzanne Ginger, voted to file bankruptcy in early December.
Credit Suisse provided $5.5 million to pay plant expenses after the bankruptcy filing and will pay another $74.5 million for a total purchase price of $80 million.
Bankruptcy attorney Barry Barash has said more than $130 million had been spent on the plant and that another $25 to $30 million is needed to finish it.
At a hearing in Peoria, U.S. Bankruptcy Judge Thomas Perkins asked if anyone objected to the sale. No one said anything. About a dozen attorneys sorted out the language of the sale documents in the courtroom.
Lurgi PSI, the main contractor for the project, opposed the sale in written court filings.
Farmer shareholders in the plant lost all their money when the bankruptcy was filed. They had already delivered grain to Central Illinois Grain, which is on the site of Central Illinois Energy.
The Illinois Department of Agriculture seized the grain and sold it to Cargill.
Earlier this week, the Illinois Department of Agriculture said the agency was able to get enough money from selling the grain to Cargill to pay the farmers 100 percent of the market value for the $6 million worth of grain at the site.
The agency did not have to use any money from the Illinois Grain Insurance Fund to pay the farmers.
Most plant employees lost their jobs in December. The handful of employees who were retained worked in management.
An attorney for Credit Suisse said some of the mechanic's liens filed by contractors have been settled or sold. He has said the company is renegotiating corn contracts with farmers.
Brenda Rothert can be reached at (309) 686-3041 or email@example.com.