Abengoa Bioethanol Arm Raided in EU Manipulation Probe

Abengoa SA, owner of continental Europe’s biggest bioethanol plant, said that it’s being investigated as part of the European Union’s antitrust probe into possible manipulation of oil and biofuel prices.

The company and its Rotterdam-based Abengoa Bioenergy Trading Europe unit were inspected over possible collusion to manipulate the Platts market-on-close process and exclude companies from the way prices are assessed, Abengoa said in a U.S. regulatory filing dated Oct. 4.

Abengoa is the latest name to emerge in the probe that started in May with raids on the offices of energy news and price publisher Platts, Statoil ASA, BP Plc, Royal Dutch Shell Plc and Argos Energies to gather evidence of possible collusion in oil and biofuel pricing. Pannonia Ethanol, a Hungarian ethanol producer, complained to the EU’s antitrust arm last year, saying Platts denied it the opportunity to contribute to the price assessments.

“We are actively cooperating with the European Commission in its investigation” and all units “have at all times complied with the applicable competition laws,” Abengoa said in the filing.

The “suspected anticompetitive conduct, agreements and/or mutually coordinated concrete actions have allegedly existed since 2002 and would likely involve various markets for which the Platts MOC process is used to report prices, including markets for biofuels,” Abengoa said.

Instant Messages

Platts has assessed prices for crude oil, petroleum products and related swaps using its market on close process since 2002 in Europe. Traders voluntarily report bids, offers and trades to Platts through e-mails, instant messages and phone conversations in a defined window period each day, which are then used to create end-of-day price assessments for various commodities, including crude oil and ethanol.

Abengoa said in a separate statement today it would raise about 400 million euros ($543 million) from a share sale. The Seville, Spain-based company aims to repay about 323 million euros due this year and next year. The shares slipped as much as 5 percent and were down 2.4 percent at 3:56 p.m. in Madrid.

EU regulators said in May that even small distortions of prices used as benchmarks for commodities and derivatives may have a huge impact on the prices of crude oil, refined oil products and biofuels purchases and sales that may have been passed on to final customers. It said there is no deadline for its investigation.

Platts Checks

Platts, a unit of New York-based McGraw Hill Financial Inc., and the oil companies raided have all said they’re cooperating with the EU probe.

Antoine Colombani, a spokesman for the Brussels-based antitrust watchdog, declined to comment on the involvement of Abengoa.

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