Aventine Renewable Energy is Latest to File Bankruptcy

Another ethanol company has to ask for protection.

On Tuesday Aventine Renewable Energy asked for Chapter 11 bankruptcy protection from the U.S. bankruptcy court in Wilmington, Del. According to the company's filing, it had $799.5 million of assets and $490.7 million of debts at year-end.

The Pekin, Ill.-based ethanol company and six affiliates cited declining liquidity and margins as the reason for asking for protection from creditors. Chief Accounting and Compliance Officer William Brennan said a large investment in auction-rate securities was partially to blame for the decline in liquidity.

Also due to fixed obligations to buy corn and natural gas at above-market prices as well as narrowing spreads between ethanol and corn prices has cause negative gross margins since mid-2008.

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