Shares of Green Plains Inc.
shot up 5.5% in premarket trading Tuesday, after activist investor Ancora Holdings Group LLC urged the ethanol producer and grain handling company to explore a sale. In a letter to Green Plains’ board of directors, Ancora, which owns nearly 7% of the shares outstanding, said the company’s ongoing transformation faces a number of risks as the economy slows and interest rates rise, and given the current political environment. Ancora estimates that a sale of the company would yield at least $50 a share for shareholders, representing at least 61% upside from Monday’s stock closing price of $31.05, and would imply a market capitalization for Green Plains of at least $2.96 billion. “Given the aforementioned risks, and the fact that Green Plains’ underlying value is significantly greater than where its shares are trading today, we are asking the Board to commence a review of value-maximizing strategic alternatives,” Ancora said in its letter. Green Plains’ stock has gained 1.7% over the past 12 months through Tuesday, while the S&P 500
has lost 11.0%.