Whitebox to make $80 million bid for bankrupt Central Illinois Energy

In Illinois, Whitebox Advisors will make a credit bid of $80 million for the bankrupt Central Illinois Energy ethanol plant. The plant’s new owner will acquire technology problems, $22 million in mechanics’ liens, and a bill for $25 million to complete the plant.

Though the bid may bring the plant to fruition, 74 investors may lose up to $5 million in the Central Illinois Energy bankruptcy case. The CIE plant was proposed in 2001 at a cost of $40 million; construction was halted prior to completion when costs had reached $130 million and the company filed for Chapter 11 bankruptcy.

Central Illinois Energy put its 37 Mgy Canton, OH ethanol plant up for sale after failing to secure $30 million in additional funding. Credit Suisse, the lead bank among the lenders, reportedly forced the sale. Construction firms had filed $20 million in mechanic’s liens against the company after after non-payment of construction and engineering bills for the plant.

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