VeraSun to Acquire US BioEnergy

NEW YORK (AP) -- VeraSun Energy Corp.'s deal Thursday to acquire US BioEnergy Corp. is likely to be the first step toward consolidation in an industry that has seen its profits squeezed by high corn costs and low ethanol prices.

VeraSun's all-stock acquisition of its smaller competitor will boost its annual production capacity to 1.6 billion gallons by the end of 2008, potentially making it the largest U.S. ethanol producer. Poet LLC is currently the top producer, with 1.1 billion gallons of capacity, according to the Renewable Fuels Association.

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