Drax completes acquisition of Pinnacle
The acquisition received overwhelming support from both companies’ shareholders, with 95.7% of Pinnacle’s and 99.99% of Drax’s shareholders voting in favour.
With this move, Drax transforms into a ‘truly’ international business, trading bioenergy from North America to Europe and Asia, and positions the group to take advantage of global growth opportunities, with the market for biomass pellets for renewable generation in Europe and Asia expected to grow significantly.
The acquisition will increase Drax’s annual operational capacity to 4.9 million tonnes (Mt) of sustainable biomass pellets from 2022, at 17 plants in locations across Western Canada and the US South – up from 1.6 Mt now. Of this increased capacity, 2.9 million will be available for Drax’s self-supply requirements from 2022. It will also give the company access to four deep water port facilities and three major wood fibre baskets.
“This is an exciting and important acquisition which positions Drax as the world’s leading sustainable biomass generation and supply business,” said Will Gardiner, Drax CEO. “I am delighted to welcome our new Pinnacle colleagues to the Drax family and look forward to what we can achieve together.
“As well as making Drax an international supplier of sustainable biomass, this deal advances our strategy to increase self-supply, reduce our own biomass production cost, and create a long-term future for sustainable bioenergy. We expect to benefit greatly from Pinnacle’s operational and commercial expertise.
“Through this deal, we are also advancing our plans to use BECCS to permanently remove millions of tonnes of CO2 from the atmosphere each year and become a carbon-negative company by 2030. Negative emissions from BECCS are vital if we are to address the global climate emergency.
“BECCS will also provide a significant share of the renewable electricity needed in a net-zero economy, support green jobs, and drive growth in a post-COVID recovery.”