Ethanol IPO

Stacey Vanek Smith Jun 15, 2006


TESS VIGELAND: Ethanol producer VeraSun had a sunny day yesterday. The share price jumped more than 30 percent in its Big Board debut. And more makers of the corn-based fuel are getting ready to go public trading. Stacey Vanek-Smith looks at the trend.

STACEY VANEK-SMITH: Wall Street was happy to lend its ears to VeraSun yesterday and two other ethanol makers are also expected to have strong debuts in coming weeks.

The Energy Tribune’s Robert Bryce says high gas prices coupled with government calls to reduce dependence on foreign oil mean high times for alternative energy.

ROBERT BRYCE: Well, it’s clear now that in the stock market, any type of alternative energy company is getting a premium price.

Still, Bryce suspects the boom won’t last. He says any alternative fuel will have to compete against oil, which has high energy value and the advantage of working in current machinery.

But, Bryce says ethanol has a leg up, thanks to a federal mandate to blend 7.5 billion gallons of it into the country’s gas supply by 2012.

I’m Stacey Vanek-Smith for Marketplace.

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