Gevo announced that it has agreed to sell 18,525,000 common stock units. Each common stock unit consists of one share of common stock and a warrant to purchase one share of common stock, at a public offering price of $1.35 per common stock unit. Gevo has granted the underwriter a 30-day option to purchase up to an additional 2,778,750 shares of common stock and/or warrants to purchase up to 2,778,750 shares of common stock to cover over-allotments, if any.
Each warrant included in a common stock unit will have an exercise price of $1.85 per share, will be exercisable from the date of original issuance and will expire on December 16, 2018. The shares of common stock and the warrants will be immediately separable and will be issued separately. The gross proceeds to Gevo from this offering are expected to be approximately $25 million, not including any future proceeds from the exercise of the warrants.
Certain of Gevo's directors and officers have expressed an interest in participating in the public offering of common stock units.
Gevo currently intends to use the net proceeds from the offering, excluding any future proceeds from the exercise of the warrants, to ramp up startup production and sales at its Luverne, Minn. plant.
Gevo also intends to use a portion of the net proceeds from the offering to repay $5.1 million in its outstanding long-term debt obligations under its loan agreement, and may also use a portion of the net proceeds from the offering to fund working capital and for other general corporate purposes, which may include paying down additional long-term debt obligations.
In connection with the offering, Piper Jaffray & Co. is acting as sole manager. Gevo also announced that it has decided not to pursue its previously announced public offering of senior note units.
The offering of common stock units was made pursuant to Gevo's shelf registration statement filed with the Securities and Exchange Commission (SEC) and declared effective, and is expected to close on or about December 16, 2013, subject to customary closing conditions.
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