5 Oct 2012

Vege company leads bid for biofuel business

7:00 am on 5 October 2012

A consortium led by a South Island onion and potato packing company is heading the bidding for part of Solid Energy's biofuels business.

The State owned enterprise announced in August it would split and sell off its Biodiesel New Zealand subsidiary, after the Government canned its biodiesel subsidy scheme.

Solid Energy said the loss of the grant had made a marginal biofuel operation unviable.

It's now named a preferred bidder for the agribusiness side of the operation - a consortium led by Southern Packers, a Timaru-based company that grades, packs and exports onions as well as supplying the local market.

It also packs potatoes for export.

The consortium also includes Midlands Seed, Biodiesel New Zealand's current agri-business manager and an agronomist contracted to the company.

It's in line to buy the operation that contracts with farmers to grow oilseed rape with the seed processed at its Rolleston oilseed extraction plant.

The oil is then sold to the food industry and the left over meal is sold for animal feed.

If the sale negotiations are successful, Solid Energy says it expects the consortium to take over the business next month.

It is also considering bids for Biodiesel New Zealand's fuel division, which manufactures and markets biofuel.