Al-Corn Clean Fuel, LLC, Chippewa Valley Ethanol Company, LLLP, Heartland Corn Products and KAAPA Ethanol, LLC signed a letter of intent to acquire Heron Lake BioEnergy, LLC for $61.6 million on December 7, 2012.

Al-Corn Clean Fuel, LLC, Chippewa Valley Ethanol Company, LLLP, Heartland Corn Products and KAAPA Ethanol, LLC entered into an asset purchase agreement to acquire Heron Lake BioEnergy, LLC for $50.6 million on January 22, 2013. As part of consideration, $4 million will be deposited into escrow for the indemnification claims. The Board of Governors has determined that Heron Lake BioEnergy, LLC should be dissolved and liquidated completely after the consummation of the transaction. The transaction also includes a 73% ownership interest in Agrinatural Gas, LLC. Under the asset purchase agreement, the acquired assets specifically excludes the Heron Lake BioEnergy, LLC's subsidiary, Lakefield Farmers Elevator, LLC, and the assets or business owned by Lakefield Farmers Elevator. Under the terms of the agreement, Heron Lake BioEnergy, LLC will pay a break-up fee of $2 million to Guardian Energy, LLC. Post acquisition, Guardian Energy Management will manage the Heron Lake plant and all Heron Lake employees, except for top managers, are expected to be retained.

The transaction is conditional upon regulatory approval, execution of escrow agreement, obtaining financing, approval of the majority of the shareholders of Heron and third party approval. The transaction was unanimously approved by the Board of Heron Lake BioEnergy, LLC. The transaction is expected to close by March 1, 2013. An independent financial management and advisory firm delivered its fairness opinion to the Board of Governors of Heron Lake BioEnergy from a financial point of view. Cathy Riley of Communications Consultant acted as the public relation advisor for Heron Lake BioEnergy, LLC. BCC Advisers acted as financial advisor for Heron and will receive a fee of $60,000. Wells Fargo Bank, N.A. acted as escrow agent in the transaction. Michael Weaver of Lindquist & Vennum PLLP acted as legal advisor for Heron Lake. Jill R. Radloff of Leonard, Street and Deinard, P.A. acted as legal advisor for Al-Corn Clean Fuel, LLC, Chippewa Valley Ethanol Company, LLLP, Heartland Corn Products and KAAPA.

Al-Corn Clean Fuel, LLC, Chippewa Valley Ethanol Company, LLLP, Heartland Corn Products and KAAPA Ethanol, LLC cancelled the acquisition of Heron Lake BioEnergy, LLC on April 4, 2013.