Sioux Falls, South Dakota – VeraSun Energy Corporation, one of the largest ethanol producers in the U.S., has announced that it and 24 of its subsidiaries have filed voluntary petitions for relief under chapter 11 of the U.S. Bankruptcy Code, to enhance liquidity while it reorganizes.
The company suffered significant losses in the third quarter of 2008 from a dramatic spike in corn costs, along with worsening capital market conditions and a tightening of trade credit. VeraSun plans to resume normal operations during the proceedings, and has taken steps to ensure continued supply of product to its customers and to fulfill all customer obligations. The company also said that it does not expect to scale back purchases of raw materials.
“Today’s filing allows VeraSun to address its short-term liquidity constraints as we navigate historically challenging market conditions while we focus on restructuring to address the company’s long-term future,” said CEO Don Endres. “We appreciate the loyalty of our employees, customers and suppliers during this challenging time.”