While the future for participants in the biofuels sector, as well as the broader renewable energy industry, remains encouraging, these parties will continue to face distinct operational and financial challenges in the years to come. These will range from engineering bottlenecks in the ramp-up period from demonstration to achieving commercial production volumes, to limited attractive options for financing capital-intensive renewable energy projects, particularly in an environment with extended low energy prices. Additionally, steady pressure from well-capitalized opposing trade groups in the ongoing battle for market share presents another obstacle.
Many producers, operating under the assumption that the advanced biofuel markets will continue to develop, have heavily invested in future renewable energy projects that have yet to come online. The next, most pressing issue for these producers will be securing the additional investments required to complete such projects, achieve target nameplate production levels, and contribute to the increasing volumes mandated under the RFS.
Carl Marks Advisors has successfully advised clients throughout the biofuel sectors (producers, senior lenders, bondholders, unsecured creditor committees, and others) on engagements representing more than 4 billion gallons of aggregate production capacity – more than any other financial advisor. Since 2008, Carl Marks has witnessed firsthand the volatility in the biofuel industries, serving as advisor on ~20 distinct M&A and restructuring engagements to date. Our unique combination of operational and financial expertise allows us to guide biofuel clients through commodity swings and credit cycles, and has provided us with an unmatched perspective into the appetite of strategic consolidators, as well as the various capital providers, within the sector.
Carl Marks Advisors’ involvement in renewable energy engagements includes, but is not limited to, the following value-added services:
- Strategic & Operational Planning – Carl Marks Advisors will work with management to develop detailed integrated financial forecasts, refine business plans, assess strategic alternatives, identify sources for needed liquidity, and target key operational and financial improvements.
- Transaction Advisory – Our expert team will establish a dialogue with key constituencies and deliver the necessary reports and communications during a transaction, in or out-of-court. We will also implement operating plans, populate an electronic data room, and create marketing materials in preparation to go to market.
- Business & Operational Assessment – Through liquidity analysis of the companies with which we work, critical review of business plans, evaluation of management, and review of cash and operating management systems, we are able to identify key drivers and immediate operational initiatives for our clients.
- Interim management – Our team of experienced professionals can step in to supplement management in the form of an experienced CEO, CFO, CRO, or COO.
- Closing Transactions – At Carl Marks Advisors we continue operational improvements through the closing of a transaction, as well as lead investor diligence, negotiate terms, arrange financing, and facilitate the details of closings for our clients.