US acquisition sets Drax back £28m

Power group Drax has revealed that its acquisition of Louisiana Pellets at auction cost the firm £28.2m ($35m).

The business, along with a sister subsidiary, Texas Pellets, went into bankruptcy last year following the insolvency of parent company German Pellets. It was formerly one of the biggest pellet manufacturers in the world.

Drax was set to participate in an auction for the site at the beginning of March, before it was delayed until later in the month.

Selby-based Drax has now been provisionally successful in its bid to acquire one of the sister companies, Louisiana Pellets, costing it $35.4m (£28.2m)

A court hearing to approve the auction result is scheduled to take place in early April, with completion of the sale expected by month-end.

The process for the sale out of bankruptcy of the assets of Texas Pellets has been postponed, but Drax insisted that it remained an interested party in the acquisition of its assets.