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Corporate History

Root of our Integrated Waste to Energy Model

Four Rivers BioEnergy Inc was created out of a concept developed by its founders in 2007. They had considerable insight into the dynamics that were driving the then rapidly growing US biofuels market and predicted (correctly) that major problems would arise from the rush to build new, large scale single product / feedstock bio fuels plants.

• The narrow scope of these plants and the lack of application of technology to release greater value from processing the feedstock at the front end and the waste products at the end of the process.
• The risks associated with fluctuating feedstock and off-take prices and the lack of integration across the cycle.
• The free supply of capital and the exploitation of that position by specialist contractors.
• Poor planning and controls around logistics.

In response to this the founders created a detailed plan for what they termed a new generation of ‘Integrated BioEnergy Plant’. This early integration theme has been transformed by the expanded management team in response to actual and anticipated trends in the waste to energy and biofuels markets into what we term today “Integrated Waste to Energy”.

Initial Financing

During 2007 the founders and their advisers raised the seed-corn funds required to launch the construction of their then first planned Integrated BioEnergy plant on the back of the founders’ business plan and expertise. The cash raised amounted to $25 million and it was obtained by way of a private placement of equity on the back of the reverse merger of an OTC quoted company.

Some $9mm of the finance raised was spent on acquiring a 437 acre plot of logistically important land in Kentucky; and preparing for construction, project finance and detailed design for the proposed Integrated BioEnergy Plant.

The collapse of the capital markets and the bursting of the 'bio-fuels bubble' hit the equity and bio-fuels project finance markets in March 2008 and the Company naturally had to withdraw from the planned $450 million financing for the then planned project.

Focusing strategy through market change

The collapse of the capital markets caused the management team to consider other ways to achieve the core objective of creating a new generation of energy business deploying the principles of integration.

The original founders, who had excellent expertise and insight into the energy, construction and bio-fuels sectors, had been joined in mid 2007 / early 2008 by two experienced individuals with broad commercial,  financial, M&A and turnaround experience (now our CEO, Mr Stephen Padgett; and CFO, Mr. Martin Thorp). They, together with those founder members who remained in management (principally Mr Gary Hudson, the lead founder and a current board member) saw a major opportunity to take advantage of the current state of the waste to energy market by setting out to acquire the ingredients to create the first Integrated Plant, modelled around the know-how, plans and insight that had led to the Kentucky project and further thinking around the logical end goal of integrating the entire waste to energy cycle.

They anticipated that there would be numerous opportunities to acquire, improve and integrate stressed asset and technologies out of the market turmoil and create a business in line with the principles of integrating across the waste to energy cycle.

Armed with (a) a relatively strong and cash rich balance sheet; (b) deep expertise in the industry and (c) considerable expertise in negotiating, screening and closing acquisitions and mergers and turnarounds; they set about selectively identifying appropriate assets.

During 2008 they identified several potential targets and entered into negotiations, but they withdrew from each of these at the due diligence stage, finding that vendors had not yet reached the point of being realistic about pricing in a distressed state.

However, in early 2009 they identified a key acquisition which was to be used as the foundation cornerstone for a new Integrated Waste to Energy Plant.

Current State

The Company’s current activity and focus is dominated by its well-advanced project to complete the construction of its first Integrated Waste to Energy Plant and the related business and commercial arrangements which are planned to lead to the launch of a profitable commercial enterprise.

Currently the management team is heavily focused on these activities coupled with raising further capital to enable the Company to complete the plant project and commence operations.

All assets considered to be non-core are under review for realisation into cash or as a basis for asset lending.