UNION CITY — Cardinal Ethanol, a 10-year-old grassroots biorefinery that produced about 131 million gallons of ethanol last year, might be sold.
In a press release, the company said that after consulting financial adviser Ascendant Partners to assist in strategic planning, Cardinal Ethanol's board of directors "has decided to explore the potential sale of the facility to obtain a profitable return of capital to the original investors and transition the ownership to an operator with the capacity and resources to ensure the plant is best positioned for long-term success."
Michael Hicks, an economist at Ball State University, speaking of the press release, said, "Insofar as I can tell … Cardinal is looking to sell itself because some of the original investors are displeased with its profits."
Wally Tyner, an agricultural economist at Purdue University, noted that, according to the press release, "the expectation is that the plant would continue to operate whether it is sold or not. If that is true, the impact on the local community and farmers supplying the plant should be minimal."
The independently owned/operated standalone plant buys tens of millions of bushels of corn ever year to produce the ethanol.
"In the last few months, net returns over all costs have been negative for a prototypical ethanol plant …, " Tyner told The Star Press. "Thus, it is possible management decided it would be a good time to try to get a reasonable sale and return equity to owners."