News blog

Astar Minerals

• BY: Andrew Hore |
• POSTED: 12/11/2012 |

Shares in Astar Minerals, formerly known as Pan Pacific Aggregates, have been suspended because it has been unable to raise cash to take on the operation of additional quarries in Canada and Seattle.

When it announced the deal in September Astar said that it had already raised C$350,000 (£222,000) of debt in Canada. Astar was required to buy equipment and inventory, as well as investing in the sites. The group would have been selling a wider range of products.

The quarries owned by Aggregates West have more than 10m tons of sand and gravel and generated revenues of more than C$9m in 2011. Astar would have paid royalties to Aggregates West based on sales volumes. The initial agreement was for three years.

At the suspension price of 1.05p a share, Astar is valued at £760,000.

Astar is also required to make a £250,000 payment relating to its July 2011 CVA. It is currently unable to make this payment at the end of December.

Astar may decide to become a shell. Astar’s quarry business in British Columbia is losing money and generated revenues of £374,000 in the first half of 2012. Net debt, mainly mortgages on the company’s quarry, was £1.1m at the end of June 2012. It is unclear how much could be raised from selling the quarry.

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