Biofuel products maker Gevo Inc. is planning public offerings of its stock and convertible senior notes due 2022.
The company did not specify the amount of shares or notes are involved in the offerings Wednesday.
Gevo expects to use the offerings' net proceeds to pay back part of its outstanding long-term debt, to pay the cash component to finish the retrofit of its Luverne, Minn. plant and to partially pay for the Redfield Energy retrofit. Any remaining funds will be used for working capital and other general corporate purposes.
Last week Gevo received a favorable ruling in a patent case filed by a competitor. A U.S. District Court judge rejected Butamax Advanced Biofuels LLC's request that the court stop Gevo from selling some of its products.
Gevo makes isobutanol, an alternative to ethanol that is blended into fuel. Butamax makes biobutanol, which is another butanol product used in producing biofuel.
Shares of Gevo, based in Englewood, Colo., dropped $1.09, or 12.4 percent, to $7.68 in morning trading. The stock has traded in a 52-week range of $4.84 to $18.75. It is not uncommon for a company's stock to fall in the short-term after it announces an offering of new shares. The dilution of existing shareholder value can scare off many investors.