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Weekend edition June 24, 2022 | Tom Ballard

Ara Partners acquires Vonore-based Genera Energy, pledges up to $200 million for expansion opportunities

Ara Partners, a Houston-based private equity firm that specializes in industrial decarbonization investments, has announced that it has acquired Genera Energy Inc., a manufacturer of non-wood agricultural pulp and molded fiber products. As part of the transaction, Ara has also committed up to an additional $200 million of capital to support significant expansion of the company’s sustainable pulp and packaging business.

According to this news release, Genera’s Vonore production facility is the largest vertically integrated non-wood agricultural pulp and molded fiber manufacturing facility operating in North America, supplying customers with domestically sourced and manufactured non-wood pulp and molded fiber products. Proceeds from Ara’s investment will be used to develop additional integrated manufacturing facilities and expand molded fiber production capacity in Vonore, enabling production of more than 5,000,000 take out containers, plates, bowls, and other food and consumer packaging products every day, all made entirely from locally grown fiber crops and agricultural residues.

Together, Ara and the Genera management team will expand the company’s production footprint across the U.S. to address the growing demand for domestically sourced sustainable packaging. By partnering with American farmers to supply purpose-grown agricultural fibers, Genera creates economic opportunities for rural communities from conservation use of land while providing an environmentally superior, biodegradable, and compostable solution to the growing global plastic pollution problem. Genera is poised to capitalize on explosive growth in the sustainable packaging market, benefiting from structural tailwinds, including onshoring of supply chains, and companies and consumers seeking sustainable alternatives to plastics.

The Genera management team is comprised of experienced managers and technical operators with deep domain expertise in agricultural biomass supply chains. Genera is well positioned to serve the fast growing, nascent industry with its established feedstock relationships and offtake commitments with marquee customers.

“There is an urgent need for solutions to the mounting global single-use plastics pollution problem that is driving insatiable demand for domestically sourced molded fiber products,” said Kelly Tiller, Genera’s Chief Executive Officer. “We are proud to partner with Ara and appreciate their passionate support of our mission and their wealth of experience in scaling manufacturing operations and building sustainable businesses.”

Genera’s previous owners – WindSail Capital Group, Coppermine Capital and Stairway Capital – will retain a minority interest in the company.

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