Attis Industries Enters into a Definitive Agreement to Acquire Corn Ethanol Facility and Grain Malting Operation from Sunoco LP

January 23, 2019

Print This Article Share it With Friends

(Attis Industries/Globe Newswire) Attis Industries Inc. (NASDAQ: ATIS) (the "Company" or "Attis"), a diversified innovation and technology holding company today announced that it has entered into a definitive asset purchase agreement with Sunoco LP (NYSE: SUN) (“Sunoco”) to acquire and operate its corn ethanol plant and grain malting operation in Fulton, NY. The plant will become the essential element of Attis’ expanding technology portfolio as it develops the site into the most comprehensive Green Tech campus for renewable fuels in the country.

Total consideration for the divestiture is $20 million in cash. The transaction is subject to regulatory clearances and customary closing conditions and is expected to close in the first quarter of 2019. Attis expects to finance the transaction with non-dilutive financing.

Attis’ management team has a long-standing relationship with Sunoco and the operational team in place at the Fulton, NY ethanol facility. For Attis, the key to the success of this transaction is the 10-year offtake agreement for the ethanol produced which creates valuable stability for Attis as it plans its capital improvement strategy for the facility. The improvements made at the facility over the next 24 months will create the first of its kind, major renewable energy campus.

“The acquisition of Sunoco’s Fulton, NY ethanol plant is a significant step in Attis establishing a foothold in the renewable fuel space, while accessing the fourth largest gasoline market in the United States,” said Jeff Cosman, Chief Executive Officer of Attis Industries. “Attis’ familiarity with the facility as well as the progressive business environment in the state of New York provide us with a unique opportunity to transform an asset with incredible potential into an innovative campus for bio-based fuel that is consistent with our short and long-term growth strategy.”

“We believe the demand for low carbon energy sources will continue to increase in the coming years and Attis is well positioned to be able to grow with that trend,” said Cosman. “The Fulton ethanol facility generates significant revenue for our growing company, it greatly changes the perspective of our investors in Attis and enables Attis to roll-out additional technology platforms under the Innovations division to expand our revenue and cashflow projections over the next two years. Having an established asset like the Fulton, NY ethanol plant on the books allows us greater access to financing opportunities, as well as provides us with a shovel ready site to begin the development and commercialization of some of our previously announced technologies.”

Included within the acquisition is the 1886 Malt House which is a direct beneficiary of incentives designed to promote the local farm to brewery industry. In 2013, New York created a farm brewery law to provide licenses only to those farmers whose beer is made primarily from locally grown farm products. Under this program, the Malt House will receive some tax-exempt status and contribute to the $4 billion per year craft brewery business in the state of New York.

“The state of New York has continually demonstrated that it is a leader in green business initiatives,” concluded Cosman. “Its continued focus on driving economic incentives for green projects while relentlessly focusing on reducing greenhouse gas emissions make New York state an ideal location for Attis. We are excited for the opportunity to work with such an established partner in Sunoco and within a green friendly environment like the state of New York.”

Attis Industries Inc.

Attis Industries Inc. (ATIS) is a holding company focused on developing and building businesses that play important roles in the new economy, which include renewable fuels, bio-based plastics, healthcare and communications infrastructure. We strive to encourage our employees to be entrepreneurs focused on innovation and technology. We will remain dynamic, persistent and motivated to our mission of winning. The growth of our company will rely on our integrity and our vision for the future. Attis Industries will continue to fulfill essential needs in healthcare, energy independence and digital communications. Today, each of these sectors provide high growth opportunities that collectively account for more than a third of our nations GDP. For more information, visit: www.attisind.com. READ MORE

Attis to buy New York ethanol plant, collaborate with Novozymes (Ethanol Producer Magazine)

Attis plans to convert Fulton ethanol plant to green tech campus (Biomass Magazine)

Metro Atlanta biofuels company agrees to pay $20M for New York State ethanol plant (Atlanta Business Chronicle)

Georgia company to buy Volney ethanol plant, add 100 jobs (Syracuse.com)

Wood, not corn, may be New York's renewable fuel future (Times Union)

Excerpt from Ethanol Producer Magazine: Attis also recently announced a collaboration with Novozymes. On Jan. 16, the same day the asset purchase agreement with Sunoco was signed, the company said Novozymes has committed to supplying the enzymes required by Attis to convert its pulp into sugar at all of its planned biorefineries. In a press release announcing the agreement, Attis said “Novozymes has a broad portfolio of biotechnology to support commercial cellulosic biofuels production, and the ability to remap up production as needed in an effort to support Attis’ ambitious growth plans.”

Information released by Attis notes the company has successfully converted pulp extracted from its patented biomass processing into high yields of sugar using Novozymes’ proprietary enzyme cocktails and said these successful results have validated the planned business model at Attis’ biorefineries. The partnership is expected to focus on improving value, yields and process efficiencies. Attis also noted that the sugars produced using Novozymes’ proprietary enzymes will be used to manufacture cellulosic ethanol. READ MORE

Excerpt from Biomass Magazine: As part of the agreement, Sunoco said it will enter into a 10-year ethanol offtake agreement with Attis. A statement released by Attis explains that offtake agreement will create valuable stability for the company as it plans its capital improvement strategy for the plant, noting “improvements made at the facility over the next 24 months will create the first of its kind, major renewable energy campus.”

According to Jeff Cosman, CEO of Attis Industries, his company will continue current corn ethanol operations at the facility, but plans to bring in advanced possessing methods to drive more value from each bushel of corn the plant processes.

...

“The same team has been developing additional improvements for the facility far beyond the successes of corn oil and corn ethanol,” he said.

Regarding planned improvements to the Fulton site, Cosman said Attis expects to invest between $80 million and $100 million in the facility and add about 100 high-skilled jobs over the next two years to develop a state-of-the-art green tech campus. “The goal would be to implement Attis’ existing suite of biomass processing and renewable fuel production technologies to manufacture more types of advanced biofuels, carbon fiber and bioplastics—all from renewable sources of carbon, such as corn and forestry residuals,” Cosman said.

According to Cosman, Attis plans to add several coproducts to the Fulton’s plants operations, including biodiesel, bioplastic additives and advanced feeds. He also noted the company plans to make energy efficiency improvements to the facility. “Carbon intensity is becoming more important and so too is energy efficiency,” he said. “Attis will be installing improvements on many fronts to take advantage of the resources available to it in New York.”

This includes the state’s forestry resources. “New York has over 18 million acres of forestland that produce over 50 million tons of biomass annually,” Cosman said. “Attis needs less than 0.3 percent of this regenerated growth to supply one of its standard biorefineries. The Fulton site is exceptional as it will allow Attis to showcase its corn ethanol and cellulosic biorefinery technologies.” READ MORE

Excerpt from Times Union: Cellulose forms the woody fiber of the plant and is difficult and costly to break down into the sugars needed for successful fermentation. Novozymes makes enzymes designed to break down the cellulose into sugars.

Chris Kennedy, vice president for Attis Innovations, said the company "absolutely" wants to start cellulosic ethanol production at the rebuilt Fulton refinery.

"Attis has a number of proprietary technologies that focus on converting forest waste and other woody biomass into cellulosic fuels and other bioproducts like carbon fiber and plastics," he said.

"New York State has over 18 million acres of forest lands that produce a wealth of sustainable feedstocks for Attis' planned non-corn biofuel production," Kennedy said. "State forest lands can produce 40 to 60 million tons of "new-growth" biomass annually and Attis needs less than 0.3 percent of this regenerating supply to supply one of its biorefineries." READ MORE