Imperium raises new money to settle debts

Troubled Seattle-based biofuel maker Imperium Renewables announced today a recapitalization to satisfy debts to its lien holders, unsecured creditors and project lender Société Générale.

Imperium said it’s hoping to resume operations at its 100 million gallon a year biodiesel plant in Washington, which was the largest in the U.S when it opened in August 2007 (see Imperium gets big with biodiesel). To help with that, the company has hired a third-party business-debt restructuring firm to negotiate with its creditors to settle remaining debts.

Company officials declined to comment on what the new capital means for the company’s future.

Times have been tough at Imperium since its former CEO left in December (see Martin Tobias out at Imperium).

In January, Imperium  canceled plans for a $345 million IPO (see Imperium Renewables puts IPO on hold). And in May, the company’s former director of trading and commodities, Kenneth Orr, filed an amended lawsuit that accused the company of unlawfully transferring trades so that he could not receive proper compensation (see Smells like fish in the fog).

“This funding is a significant step in the process we set forth in January to turn this company around, but we still face hurdles as the amount of funding is limited,” John Plaza, founder and CEO of Imperium Renewables, said in a statement. “Despite the recent and overdue correction in the commodities markets, the biodiesel industry remains extremely volatile and the company is still under stress.”

Plaza said the financial restructuring is part of the efforts to “ensure the long-term viability of the company.”

Imperium’s plant can use any feedstock to produce biodiesel and can store 17 million gallons of biodiesel and feedstock at a time.

See the plant here>>

In February, The U.K.'s Virgin Atlantic completed the world's first biofuel-powered test flight of a commercial aircraft, using a 20-percent biodiesel blend from Imperium (see Virgin takes off with commercial biofuel test flight).