Pacific Ethanol defaults on some loan covenants; creditors extend forbearance until Feb 27 to renegotiate debt

In California, major ethanol producer Pacific Ethanol has defaulted on an undisclosed series of loan covenants. The Sacramento Business Journal is reporting that the company has secured a forbearance agreement from two major lenders through February 27th while it renegotiates operating lines of credit with Wachovia Capital Finance. The Business Journal is also reporting that the company is negotiating with WestLB among other lenders regarding its term loans and lines of credit.

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