Tuesday, June 17, 2014
Cool Planet Goes Silent After Capital Raise
Cool Planet Energy Systems (private) has kept a quiet profile since the company announced raising $100 million through a private placement of Series D common stock. Long-time investors North Bridge Venture Partners and Concord Energy led the round, which was managed by UBS and Goldman Sachs.
Neither the author of the Small Cap Strategist web log, Crystal Equity Research nor its affiliates have a beneficial interest in the companies mentioned herein. Cool Planet is included in the Biofuel Group of Crystal Equity Research’s Beach Boys Index alternative energy companies.
Even though the capital raise was just three months ago back in March 2014, we expected to hear more from the Cool Planet as the company deploys that capital to build its first commercial-scale biofuel production plant in Louisiana. Cool Planet had already received construction permits for the facility, which is designed to have a capacity of 10 million gallons of renewable fuel per year. The company actually broke ground on the Louisiana construction project in February 2014 just one month before the last capital raise.
Cool Planet uses wood residue in a two step process that turns out ‘green’ gasoline that is chemically identical to fossil fuel. The first step is mechanical, breaking down the wood materials with heat and pressure. The gases that get created are taken through a second step where proprietary catalysts convert the gases to gasoline. A by-product of the process is biochar, which is sold to the agriculture and water treatment industries.
It is premature to expect production from the Louisiana facility. Construction and commissioning could take well over a year. However, with stellar sponsors the likes of North Bridge it is likely we are not the only ones who want to see progress as Cool Planet. No doubt all of Cool Planet’s supporters from the venture capital community are anxiously awaiting the point at which the company takes that value creating step from developmental to commercial stage. With any good luck for the rest of us Cool Planet and its venture buddies will stage an initial public offering and share the upside of ramping commercial production, sales and profits.