Rentech investor offers $441M buyout

Los Angeles-based synthetic fuels and fertilizer company Rentech (AMEX: RTK) received a $2.70 per share buyout offer from Florida investor Sherwood Investments Overseas.

The offer would value the company, whose shares recently dropped as low as $1.72, at $441 million.

"We are concerned that your weak share price may hinder your ability to execute your business plan and suggest that you should consider either taking the company private or spinning off the fertilizer operation," said Julian Benscher of Sherwood Investments in a letter to Rentech.

Sherwood said it owns 4.7 million shares of Rentech, or 2.9 percent of its outstanding shares.

Rentech, founded in 1981, has never earned a profit and announced in its most recent quarterly filing that "we will need substantial amounts of capital that we do not now have" to fund its projects.

"It appears that Rentech has the benefit of owning tremendous assets at a time when they are critically needed in the United States (and elsewhere)," said Benscher, noting that the company was struggling despite a boost in the price of oil and fertilizer, with gains being posted by other fertilizer companies.

Rentech has not yet responded to Sherwood's offer.

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