Tomahawk, WI 12/12/2013 (BasicsMedia) – Gevo, Inc. (NASDAQ:GEVO) is a company that produces renewable chemicals as well as advanced biofuels. It focuses on developing and commercializing various alternatives for different petroleum-based products. Gevo, Inc. (NASDAQ:GEVO) operates in two distinct business segments- the first segment is Gevo, Inc. while the other one is Gevo Development/Agri-Energy Segment. The company’s Gevo, Inc. Segment handles all the research and development activities that are related to any future isobutanol production.

The effort

The company has been making every effort to produce higher-value alcohol at the company’s Luverne, Minnesota plant. To this effect, it is also burning very rapidly through its cash-pile and needs some more cash in its kitty soon. On Tuesday, Gevo, Inc. (NASDAQ:GEVO) that it will now sell some stock and senior-notes in order to raise capital.

Gevo, Inc. (NASDAQ:GEVO) said that the proceeds from this particular offering will be utilized in ramping up production at the plant. Apart from this, it will also be used to repay $5.1M of its long-term debt.  The Luverne plant used to produce ethanol earlier. The company has converted that into an isobutanol producing plant. The latter is a BioFuel and a renewable chemical and Gevo, Inc. (NASDAQ:GEVO) is using its proprietary technology in its production.

The offer

The offering is being managed by Piper Jaffray & Co of Minneapolis. Each common-stock unit is inclusive of a warrant for some additional stock. Every senior note unit will also consist of a principal amount of $1,000, of convertible notes that will be due in 2023. It will also include warrants for purchasing a certain number of common stock shares said the company in its statement. The company has been reeling under production delays at the plant and also had to halt production in 2012 September. The company’s stock has also taken a severe beating. Gevo, Inc. (NASDAQ:GEVO) shares have traded below $2/share since late-September and on Tuesday the shares had a closing price of $1.66.

Technical Analysis:

From the below chart it can be clearly seen that Gevo, Inc. (NASDAQ:GEVO) is in downtrend since the mid of September’13 and the stock has been falling continuously. The stock made a bottom of $1.3 on 5th November’13 before rallying up again. The stock crashed again with high volumes and currently is in downtrend.

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Fundamentals:

Gevo, Inc. (NASDAQ:GEVO) has an institutional ownership of 49.50% in the stock which has reduced by 8.45% in the past three months. There has been no insider buying in the stock in past three months. Insider’s ownership in the company stands at 1.90%. The company is bleeding in terms of its ROA, ROE and ROI which are all negative of 46.30%, 76% and 48.50%.

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