VeraSun Energy Corporation announced it has filed voluntary petitions for relief under chapter 11 of the U.S. Bankruptcy Code in the United States Bankruptcy Court for the District of Delaware. The firm said in a release that the move was needed to “enhance liquidity while they reorganize.”
Among reasons cited by the firm for the step: The Company suffered significant losses in the third quarter of 2008 from a dramatic spike in its corn costs, reflecting in part costs attributable to its corn procurement and hedging arrangements, and historically unfavorable margins. “VeraSun and 24 of its subsidiaries filed their chapter 11 petitions to facilitate access to additional liquidity while they reorganize to take better advantage of VeraSun’s position as one of the nation’s largest producers of ethanol,” the firm said.
However, they announced that during the chapter 11 proceedings, VeraSun plans to resume normal operations.
Click here to read the full release from the firm.
