Pacific Ethanol Announces $8.0 Million Private Placement and Agreement to Increase Ownership in Plants to 34%

Tallahassee, FL 12/8/11 (StreetBeat) -- Pacific Ethanol, Inc. (Nasdaq:PEIX), the leading marketer and producer of low-carbon renewable fuels in the Western United States, has entered into a definitive purchase agreement with a group of institutional investors to raise $8.0 million in a private placement transaction. Further, the company has signed purchase agreements to acquire an additional 7% interest in the Pacific Ethanol production facilities.

Of the net proceeds from the financing, $4.6 million will be used for the purchase of the additional 7% ownership interest in New PE Holdco LLC, the owner of the four Pacific Ethanol production facilities with a combined annual production capacity of 200 million gallons. Upon closing, the company's total ownership interest will increase to 34%. On October 6, 2010, the company paid $23.3 million in cash for its initial 20% ownership interest, and on November 29, 2011, the company purchased an additional 7% ownership interest for $4.5 million.

"With the purchase of this additional 7% interest, we continue to further our objective of increasing ownership in these and other production facilities," said Neil Koehler, the company's president and CEO. "Within a month, we will have increased our total ownership in the Pacific Ethanol Plants from 20% to 34% at values that are favorable compared to both replacement costs and current market."

Under the terms of the financing transaction, the company is to issue in aggregate 7,625,000 shares of its common stock, at a price of $1.05 per share for gross proceeds of $8,006,250. The purchase price per share was determined based on a discount of approximately 19% to the closing sale price of the company's common stock on December 8, 2011. The investors will also acquire warrants under which they will have the right to purchase an aggregate of 4,956,250 shares of common stock at an exercise price of $1.50 per share. The warrants have a five-year term. Lazard Capital Markets LLC acted as the sole placement agent for the private placement, which is expected to close on or about December 13, 2011. Further details on the transactions are available in the company's Form 8-K filed today with the Securities and Exchange Commission.

The securities sold in this private placement have not been registered under the Securities Act of 1933 and may not be offered or sold in the United States in the absence of an effective registration statement or exemption from registration requirements. The company has agreed to file a resale registration statement on Form S-1 by no later than December 23, 2011 for the purpose of registering the resale of the shares of common stock issued at the closing and the shares of common stock underlying the warrants.

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Pacific Ethanol Increases Ownership in Plants

Palm Beach, FL 12/1/11 (StreetBeat) --Pacific Ethanol, Inc. (Nasdaq:PEIX), the leading marketer and producer of low-carbon renewable fuels in the Western United States, purchased an additional 7% ownership interest in New PE Holdco LLC, the owner of the four Pacific Ethanol production facilities with a combined annual production capacity of 200 million gallons. The company paid $4.5 million in cash for the additional interest. This purchase brings the company's total ownership interest to 27%. On October 6, 2010, the company paid $23.3 million in cash for its initial 20% ownership interest.

"We are excited to increase our ownership interest at an attractive valuation. At current margins, this transaction is immediately accretive to shareholders, and is priced at a discount to both market valuations and our initial 20% purchase," said the company's president and CEO, Neil Koehler. "Ethanol continues to grow as a cost effective and low-carbon component of transportation fuel and we intend to seek additional ownership opportunities in these and other production facilities on favorable terms to further enhance shareholder value."

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Bedford Reports Issued for Stocks PEIX and BIOF

Dallas, TX 5/5/2011 (PennyPayDay) -- In a press release issued yesterday, the Bedford Report examines the outlook for companies in the Ethanol Industry and provided research reports on Pacific Ethanol Corporation (NASDAQ:PEIX) & BioFuel Energy Corporation (NASDAQ:BIOF).

According to the press release, driven by the US Clean Air Act and EPA regulations, the long term prospects for the Ethanol sector appear strong. These days, fossil fuels are losing favor, with alternative energies such as biofuel gaining traction as legitimate energy sources. In addition, new technologies to produce ethanol from plant fibers could help to make ethanol cost-competitive with conventional fuels, leading to further industry expansion.

New EPA regulations set forth this year have likely solidified ethanol's future in gasoline. The EPA approved the use of up to 15 percent ethanol in gasoline in vehicles produced during 2001-2006. The EPA had already approved the 15 percent ethanol tolerance for vehicles made in 2007 or later.

Ethanol can be used in much higher proportions, with up to 85 percent ethanol in special factory-produced vehicles. A growing number of these vehicles are being produced by auto manufacturers to test market demand for such a vehicle.

Not everyone is pleased with ethanol's surge in popularity, as recent reports have surfaced blaming ethanol for the skyrocketing prices at the supermarket. The favorable US governmental policies that promote corn being used by US-based ethanol plants have sent corn demand surging, leading many analysts to argue that ethanol is partially responsible for the higher corn prices. Since corn is used to feed-livestock, meat prices are expected to rise along with foods that include corn, such as cereals and bread.

Higher corn prices also squeezes margins for producers such as Pacific Ethanol. Although margins are narrow for ethanol producers, Chris Highsmith, senior commodities research and strategy analyst at Eco-Energy Inc. argues that it remains more financially attractive to continue producing ethanol than to shut plants down.

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