KiOR
The business, the turning points, and the decisions behind them.
01 / WHAT IT BUILT
What the company did
KiOR was a biofuel maker that converted wood waste, wood chips, switchgrass and corn husks into gasoline and diesel fuel via a catalytic cracking process. Backed by Vinod Khosla and Bill Gates, it opened its first commercial-scale cellulosic biofuel plant in Columbus, Mississippi in 2012 - the first in the US to convert wood waste and non-food crops into fuel on a commercial scale.
02 / KiOR FAILURE REASONS
Failure reasons
Technology failed to scale: the Columbus plant never reached full capacity, with production costs projected at $6.72 per gallon against poor-quality fuel selling for just $2.76. Operations broke down after a January 2014 shutdown for upgrades that never restored output - no fuel had been produced by the end of March, and the company warned it would run out of operating funds. KiOR then defaulted on its Mississippi loan and filed Chapter 11 listing consolidated assets of $58.3 million against $261.3 million in debt.
03 / EVENT HISTORY
Events in the structured record
- Asset restructuring
KiOR, Inc. (OTC:KIOR) filed bankruptcy restructuring in Delaware Bankruptcy Court to facilitate sale/reorganization; accepted a bid for substantially all assets from Vinod Khosla affiliates (subject to higher bids/court approval); NASDAQ delisted 6 Nov 2014; company stated no anticipated recovery for common shareholders.
04 / CONTEMPORARY REBUILD ASSESSMENT
Difficulty of rebuilding this project today
Material for this section is being gathered and checked. It will appear here once ready.
Overall assessment: Not completed
05 / CAUSAL CHAIN
How the factors connect
- 01
In October 2014 KiOR defaulted on a $78.6 million debt repayment to the state of Mississippi, triggering early repayment demands from other lenders including Alberta Investment Management.
- 02
On November 9, 2014 KiOR filed for Chapter 11 bankruptcy protection in Delaware, with a plan to sell substantially all assets to affiliates of backer Vinod Khosla if no better offer emerged.
- 03
Guggenheim Securities solicited more than 165 potential buyers; only the lender/Khosla-affiliated Pasadena Investments bid materialized.
- 04
A Khosla affiliate agreed to provide up to $15 million in debtor-in-possession financing and convert $16 million of senior secured debt into new equity of a reorganized company; unsecured creditors and stockholders were not expected to recover funds.
- 05
KiOR was delisted from NASDAQ on October 27, 2014. No audited loss figure separate from the filing's balance sheet was disclosed.