Capitaline: Investing in Low Carbon Fuel with Focus & Discipline
We were an early investor in the build-out of the American Ethanol Industry
Capitaline was an early investor in the build-out of the American Ethanol Industry. Our first renewable energy fund was Capitaline Renewable Energy, LP. Launched in 2004, just prior to the ethanol industry ramping up, this $14 million fund invested in six developing ethanol companies. The final investments in the fund were harvested in 2013, providing an Internal Rate Return in excess of 56% over nine-year life of the fund.
The next round of ethanol investment opportunities came as a result of Gordon Ommen, Capitaline, and a group of investors founding US BioEnergy Corporation. Led by Gordon as the Chairman and CEO, US Bio raised $1.5 billion of debt and equity in a 36 month period, including the completion of a successful IPO on the NASDAQ Global Market in 2006. Capitaline formed two funds supplying pre-IPO growth capital to US Bio. These funds, Capitaline Renewable Energy II and Capitaline Renewable Energy III, raised in excess of $56 million and provided investors with IRRs of 77% and 28% respectively.
In 2006 Capitaline Renewable Energy IV was launched. This fund raised $15.5 million in capital, investing the proceeds in an ethanol company in Iowa. At the time the company owned one 40 MGY plant. Today, the ethanol company owns plants in Iowa, Illinois, and Wisconsin with combined annual production capacity in excess of 400 MGY. In addition, the company owns several grain elevators representing storage capacity in excess of 15 million bushels. Although closed to new investors, this fund is still active. Investors have received all of their investment back through distributions and the fund continues to perform well.
Capitaline is currently leveraging its experience in the ethanol industry to build and manage a portfolio of ethanol plant investments in Capitaline Growth & Income, LP. This is an open-ended fund investing in thinly traded ethanol companies, agribusinesses, and community banks.
At Capitaline Renewable Energy Investment Comes Naturally
CRE III was closed on 3/31/2006 with capital commitments of $27,085,000. The Fund invested in an ethanol company with multiple plants. The investment became liquid through an IPO in 2006 and shares were distributed in 2007. The Fund provided an annualized IRR of 28% over its 18 month life.
At Capitaline, we are pleased to have leveraged our decade long experience investing in the ethanol sector into over $158 million of investor profits, representing an average annualized return in excess of 58%.
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