Renewable Energy Group Prices $125 Mln Convertible Senior Notes Offering

(RTTNews) - Renewable Energy Group, Inc. (REGI) said Friday that it has priced its public offering of $125 million aggregate principal amount of 2.75% convertible senior notes due 2019.

The company has also granted the underwriters a 13-day option to purchase up to an additional $18.75 million aggregate principal amount of such notes to cover over-allotments, if any.

The offering is scheduled to close on June 3.

The company estimates that the net proceeds from the offering will be about $120.4 million after deducting the underwriting discount and estimated offering expenses, assuming no exercise of the underwriters' over-allotment option. Renewable Energy Group plans to use about $100 million of the net proceeds from the offering to replace the letter of credit that guarantees the Gulf Opportunity Zone bonds issued in connection with the Dynamic Fuels, LLC biorefinery in Geismar, Louisiana or to redeem those bonds.

The company also plans to use a portion of the net proceeds from this offering to fund the cost of some capped call transactions.

Renewable Energy Group plans to use the remaining net proceeds from the offering for working capital and other general corporate purposes. In connection with the pricing of the notes, Renewable Energy Group also entered into privately-negotiated capped call transactions with respect to about 92.5% of the shares underlying the notes with the underwriters or their affiliates (in this capacity, the "option counterparties"). The company estimates that the cost of the capped call transactions will be about $10.35 million.