What Does The Andersons' (NASDAQ:ANDE) $915 Million Harvestone Acquisition Mean for Its Ethanol Business?

Sonal Goyal

05 November 2026 12:35 PM AEDT

What Does The Andersons' (NASDAQ:ANDE) $915 Million Harvestone Acquisition Mean for Its Ethanol Business?

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Key Highlights

• The Andersons is acquiring Harvestone Low Carbon Partners for $915 million from Energy Capital Partners

• The deal adds approximately 215 million gallons of annual ethanol production, expanding the combined platform to about 730 million gallons

• Approximately half of the purchase price is attributed to expected 45Z and 45Q tax Credit cash flows

• The transaction is expected to be immediately accretive to Earnings Per Share and cash flows

The Andersons, Inc.(NASDAQ:ANDE), a diversified company with operations in grain, ethanol, and plant nutrient sectors, announced on November 4, 2026, that it has entered into a definitive agreement to acquire Harvestone Low Carbon Partners (HLCP) from Energy Capital Partners for $915 million. The Acquisition would expand The Andersons' renewables platform by more than 40%.

Transaction Structure and Rationale

HLCP owns and operates three ethanol production facilities located in North Dakota and Indiana. The acquisition would add approximately 215 million gallons of annual ethanol production capacity, bringing The Andersons' combined platform to approximately 730 million gallons per year. Approximately half of the $915 million purchase price is attributed to expected cash flows from 45Z and 45Q tax credits, with the remainder attributed to the underlying base ethanol operations and additional low-carbon opportunities.

The transaction is expected to be financed through a combination of approximately $300 million in borrowings under The Andersons' existing revolving credit Facility and $615 million in additional long-term debt. Committed financing has been provided by U.S. Bank National Association and Farm Credit Mid-America, PCA. The company expects pro forma long-term debt-to-EBITDA to remain below its stated target of less than 2.5x following the close.

Carbon Capture Capabilities

A distinguishing feature of HLCP is its development and commercialization of vertically integrated carbon capture and sequestration (CCS) capabilities. The acquisition would place The Andersons among a very limited number of U.S. ethanol producers with demonstrated Class VI CO2 injection capabilities. HLCP's operating CCS infrastructure reduces the carbon intensity of ethanol production and enables the Business to capture value through low-carbon fuel markets and applicable tax incentives.

Lower-carbon ethanol can command premium pricing, and HLCP has an established track record of commercializing its low-carbon production. The company's facilities in North Dakota are described as well-positioned to serve low-carbon fuel markets, while its Indiana facility complements The Andersons' existing Eastern Corn Belt operations.

Strategic Fit and Synergies

The Andersons' CEO Bill Krueger stated that the company has been evaluating ethanol plant acquisition opportunities for several years and characterized HLCP's production economics, low-carbon capabilities, and strategically advantaged locations as complementary to the existing network. The company's grain origination, merchandising, and logistics capabilities are expected to create synergistic opportunities around feedstock procurement, value capture from ethanol and co-products including DDGS and distillers corn oil, and Supply chain efficiency.

Additional potential benefits cited include implementing best practices from both companies, maximizing customer relationships across the combined plant fleet, and implementing The Andersons' Regenerative Ag programs. Goldman Sachs served as exclusive Financial Advisor and Polsinelli PC served as legal advisor to The Andersons on the transaction.

Timeline and Next Steps

The company expects the transaction to close in the fourth quarter of 2026 or early in the first quarter of 2027, subject to required regulatory approvals and other customary closing conditions. The purchase price includes a normalized level of Working Capital and is subject to customary adjustments at closing. HLCP is expected to generate substantial Cash Flow through its ethanol production operations combined with the generation of 45Z and 45Q tax credits. The anticipated immediate accretion from the transaction and cash flow generation from the combined business is expected to support The Andersons' established capital allocation priorities, including continued investments in growth and returns to shareholders.

FAQs

Q: How much is The Andersons paying for Harvestone Low Carbon Partners?

A: The Andersons is acquiring HLCP for $915 million, with approximately half attributed to expected 45Z and 45Q tax credit cash flows.

Q: How many ethanol facilities does HLCP operate?

A: HLCP operates three ethanol production facilities, two in North Dakota and one in Indiana.

Q: When is the Harvestone acquisition expected to close?

A: The transaction is expected to close in Q4 2026 or early Q1 2027, subject to regulatory approvals and customary closing conditions.

Q: What is the combined ethanol production capacity after the deal?

A: Upon closing, The Andersons' combined ethanol production platform will have approximately 730 million gallons of annual capacity.

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