Re-listed AIM quarry concern Pan Pacific Aggregates hopes to build up production in Canada after losing an annual £1 million.

Managing director William Voaden says the battle-scarred company, which raised £1 million at a bombed-out 1p in August, still has £550,000 cash and is determined to develop production at the Pumptown quarry in British Columbia. According to Voaden, PPA has identified ways of solving problems over equipment finance and access that threatened to thwart this project.

Pumptown is the quarry on which most of the company’s hopes are fixed, following indigenous people’s objections to PPA’s quarrying plans in the nearby Sechelt Peninsula.
Buying Pumptown for cash and shares gave the vendor, CNI (a local company controlled by brother developers Herb and Steve Dunton) a big slice of PPA.

But the company, which floated at 80p three years ago, had its shares suspended recently after it emerged that the Pumptown equipment came with heavy financial encumbrances – contrary to what PPA says was its prior understanding – and the bridge on the access road could not take heavy quarry traffic anyway.

Nominated adviser Hanson Westhouse resigned amid recriminations over due diligence, and the broker to the £1 million placing says one subscribing institutional shareholder came round in a fury to its office and so intimidated the receptionist that the police were called.

With Dowgate Capital as PPA’s new nominated adviser, Voaden hopes to renegotiate and ‘ring fence’ the equipment financing with HSBC bank, helped by new director Euan McAlpine, and suggests the company could obtain equipment at a fraction of the cost at auction. He also contends that a serviceable alternative access road could be built ‘in about a month’ for little more than £100,000.

PPA shares, which hit 91p two years ago, now languish at 1.12p. That values the company at £3.2 million.

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Pan Pacific Aggregates	AIM	£0.92m	0.32p	0.00p
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Other company articles:
PPA perseveres			02/10/2008
PPA back to AIM			29/09/2008
Crisis hits PPA			29/08/2008
Pan Pacific Aggregates			08/07/2008
PPA builds for recovery			20/06/2008