Institutional and retail investors were offered 27 million shares at $1 per share to raise $27 million before costs, which the company has said will fund the construction of a 100,000 tonnes per annum biodiesel plant in Kuantan Port, Malaysia.

According to Mission Biofuels, institutional investor interest was very strong and its April 8 opening of the IPO has been “significantly oversubscribed”, closing well in advance of its scheduled closing date of May 4.

“We are encouraged by the high level of demand for our shares from a broad array of investors,” Mission Biofuels managing director Nathan Mahalingam said.

“A busy time lies ahead for Mission Biofuels – construction of the plant in Malaysia commences next month and we are eager to progress the company’s growth strategy for our new shareholders.”

Subject to further liaison with the ASX, allotment of shares is expected to take place next week and it is anticipated that share trading on the ASX is likely to commence in early May.

The Malaysian biodiesel plant will use crude palm oil as its feedstock, which it estimates as $270 per tonne cheaper than rapeseed oil, the predominant feedstock used by its intended competitors in the European biodiesel market.

Mission Biofuels said it had already secured a five-year offtake agreement with European commodity trader Godiva for up to 250,000tpa of its biodiesel production, far exceeding its initial proposed production capacity.

The company claims that if the proposed Malaysian plant operates at 80% capacity over the nine months after it has been commissioned, the intake/offtake agreements in place should generate $A74.3 million revenue in fiscal year 2008, delivering net profit after tax of $27.7 million.