Midwest Biodiesel to rehire workers thanks to $300,000 loan
St. Louis Business Journal
September 22, 2010
By Kelsey Volkmann
Midwest Biodiesel Products LLC, the only biodiesel refiner in the St. Louis area, plans to use a $300,000 loan from the St. Louis Business Development Fund and St. Louis Private Fund to rehire laid-off workers and buy soybean and vegetable oil.
"This financing definitely helps us continue expansion of our sales," said Terry Zintel, president of privately held Midwest Biodiesel, also known as St. Louis Biofuels LLC. The funds have a "good group people to work with and they showed sincere interest in the business model and believed in it."
Many refiners have struggled to survive since a $1-per-gallon biodiesel blender's tax credit expired Dec. 31.
Zintel had to lay off five employees -- half his staff -- since April. But now he hopes to bring them back.
His company's $8 million, 12,000-square-foot facility in South Roxana, Ill., was built in 2006 and has the capacity to produce 12 million gallons of fuel annually. But Zintel said it is difficult to project how much longer he, partner Andy Sprague and their fellow investors can sustain their business under current conditions.
Congress has yet to pass an extension of the tax credit.
Many refiners are benefiting from U.S. Environmental Protection Agency mandates that require oil companies to blend petroleum-based diesel with minimum levels of biodiesel to reduce pollution.
With an infusion of extra funding, Zintel said he is hopeful about increasing sales and turning a profit in the spring.
The St. Louis Business Development Fund, a private, for-profit corporation owned by 27 bank shareholders and three local economic development agencies, invests in growing companies that demonstrate significant potential for success but are unable to access sufficient senior debt to finance organic growth or acquisitions. The St. Louis Business Development Fund and St. Louis Private Fund have agreed to co-invest in approved applications submitted to SLBDF. The primary reason for the agreement is to increase the maximum investment amount to $1 million from $500,000.
The Private Fund investors consist of 22 local business leaders who are interested in promoting the economic growth in the region by investing in successful local companies.
