Earlier this month, we reported that Pacific Ethanol’s Chapter 11 bankruptcy plan had been approved and that its four plants would soon be out of bankruptcy. That plan went into effect yesterday and the plants are now officially out of bankruptcy, having been transferred to a holding company called “New PEHC.”

Pacific Ethanol will continue to operate the plants and market the ethanol they produce via a fee and profit-sharing arrangement.The plan has wiped $290 million in debt and additional liabilities from Pacific Ethanol’s balance sheet, and it has a 90-day exclusive option to buy a 25% equity interest in New PEHC for up to $30 million in cash.

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In a press release,Neil Koehler, the Company’s President and Chief Executive Officer, commented on the news:

“Thanks to the dedicated work of our employees and the cooperation of our lenders we have achieved this important and positive outcome. We believe that our business is well positioned for growth. With the California plants capable of producing the lowest carbon ethanol in the United States, we are now focused on a plan to restart these facilities to provide much needed ethanol to meet California’s Low Carbon Fuel Standard.”