LOS ANGELES--(BUSINESS WIRE)--Nov. 4, 2014-- Rentech, Inc. (NASDAQ:RTK) announced today that it has closed the previously announced sale of its alternative energy technologies to Sunshine Kaidi New Energy Group Co., Ltd. (Kaidi). Rentech received a cash payment of $14.4 million from Kaidi, which is in addition to $0.5 million in cash payments previously received. Kaidi will pay an additional $0.4 million to Rentech to purchase various equipment currently located at Rentech's decommissioned Product Demonstration Unit (PDU), resulting in $15.3 million of total proceeds to Rentech from these transactions. This additional transaction is expected to close before the end of the year.
D. Hunt Ramsbottom, president and CEO of Rentech, stated, "We are pleased to have closed this sale as part of our cost reduction efforts and focus on our wood fibre processing and nitrogen fertilizer businesses. By monetizing these non-core assets, we have improved our balance sheet and will be realizing significant SG&A savings going forward."
The transaction calls for the possibility of success payments to Rentech of up to $16.2 million. These payments would be triggered if Kaidi successfully builds and operates, at its cost, a demonstration-scale plant in China that uses the technologies acquired from Rentech and performs at specified levels. Rentech and Kaidi will share equally in any proceeds from the future sale of the PDU site in Commerce City, CO, net of transaction fees and carrying costs of the property incurred by Rentech after September 30, 2014. Rentech expects to close on the sale of the site in the first half of 2015.
The sale of the technologies should increase Rentech's net operating loss carryforwards applicable to federally taxable income by approximately $12.5 million.
About Rentech, Inc.
Rentech, Inc. (NASDAQ: RTK) owns and operates wood fibre processing, wood pellet production and nitrogen fertilizer manufacturing businesses. Rentech offers a full range of integrated wood fibre services for commercial and industrial customers around the world, including wood chipping services, operations, marketing, trading and vessel loading, through its subsidiary, Fulghum Fibres. The Company's New England Wood Pellet subsidiary is a leading producer of bagged pellets for the U.S. heating market. Rentech manufactures and sells nitrogen fertilizer through its publicly-traded subsidiary, Rentech Nitrogen Partners, L.P. (NYSE: RNF). Please visit www.rentechinc.com and www.rentechnitrogen.com for more information.
Safe Harbor Statement
This press release contains forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995 about matters such as the expected closing date of the sale of the PDU site, future SG&A savings and the potential for success payments. These statements are based on management's current expectations and actual results may differ materially as a result of various risks and uncertainties. Other factors that could cause actual results to differ from those reflected in the forward-looking statements are set forth in the Company's prior press releases and periodic public filings with the Securities and Exchange Commission, which are available via Rentech's website at www.rentechinc.comhttp://cts.businesswire.com/ct/CT?id=smartlink&url=http%3A%2F%2Fwww.rentechinc.com&esheet=50974638&newsitemid=20141104005273&lan=en-US&anchor=www.rentechinc.com&index=3&md5=c6b46bb76834aabe1a2bf3a6576aeeac. The forward-looking statements in this press release are made as of the date of this press release and Rentech does not undertake to revise or update these forward-looking statements, except to the extent that it is required to do so under applicable law.
Source: Rentech, Inc.
Rentech, Inc.
Julie Dawoodjee Cafarella
Vice President of Investor Relations and Communications
310-571-9800
[email protected]