March 31 Shares in Biofuel Energy Corp
more than doubled after hedge fund manager David Einhorn and his
affiliates unveiled a plan to take a controlling stake in the
Einhorn already holds more than 35 percent of Biofuel
Energy, mostly through his investment fund, Greenlight Capital
Inc, according to a regulatory filing on Friday.
The preliminary proposal involves Biofuel buying real-estate
assets controlled by Greenlight and real estate investor James
Brickman for $275 million in cash and Biofuel stock.
Brickman will become Biofuel Energy's chief executive after
the deal and sit on the company's board along with David
Einhorn, the filings showed. (link.reuters.com/xux97v)
Brickman, together with certain trusts and family members,
will own 8.4 percent of Biofuel Energy after the deal, while
Greenlight will own 49.9 percent.
Biofuel said it would establish a special committee of
independent directors to evaluate the proposal and other options
for the company.
Greenlight was not immediately available for comment.
Biofuel shares, which closed at $3.14 on Friday, more than
doubled to $6.64 in morning trade on Monday, valuing the company
at $40.56 million.
(Reporting by Swetha Gopinath and Sayantani Ghosh in Bangalore;
Editing by Rodney Joyce)