The Andersons, Inc. to Acquire Harvestone Low Carbon Partners, Expanding Ethanol Production Capacity and Low-Carbon Fuels Capabilities

What happened

The Andersons agreed to acquire Harvestone Low Carbon Partners from Energy Capital Partners for $915 million. The deal adds three ethanol facilities in North Dakota and Indiana and about 215 million gallons of annual production capacity; upon closing, the combined platform is expected to have about 730 million gallons of annual capacity.

Confirmed

Global impact / market context

The acquisition would expand The Andersons’ ethanol output and low-carbon fuels capabilities, potentially giving it more production to serve premium markets. About half the purchase price is attributed to expected 45Z and 45Q tax-credit cash flows, making those future credits an important part of the deal’s economics.

Analyst inference

The agreement is definitive, but completion remains subject to customary adjustments and closing conditions. The company says the transaction is expected to increase earnings per share and cash flows immediately after closing; these are stated expectations, not reported results, and the tax-credit cash flows are also expected.

Confirmed

What to watch

1. Watch for the deal to close and for the final purchase-price adjustments, since the agreement includes a normalized level of working capital and customary closing conditions. Confirmed
2. Track whether the expected 45Z and 45Q tax-credit cash flows materialize; about half of the purchase price is attributed to them, tying deal economics to those credits. Analyst inference
3. After closing, compare actual earnings per share and cash flows with the company’s expectation of an immediate increase, and assess whether the combined platform reaches about 730 million gallons of annual capacity. Analyst inference

Evidence

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