Pressing On - Environmental Recycling (ENRT)
15/2/2010
(119264)
Pressing On
The plan to open a factory in Coffee County, Georgia to turn out PIM products for the construction industry is still limping along, despite delays due to cash shortages and other problems.
Unveiled to a mighty fanfare in March last year with the state governor and media galore on hand, the Coffee County plant was due to have been operating late last year, or maybe earlier. In mid-November, as reported here, nothing much was happening, though there was talk that a logjam caused by environmental concerns at the factory had been cleared. Some cash appears to have arrived, and there has been work in re-fitting the factory.
Though locating it is beyond me (maybe our resident aces monty or Miranda can do it), there appears to have been a press release last month from GreenTech Global announcing that the facility will open in June. According to a report in the local newspaper, the Douglas Enterprise, there is to be a grand opening on a date to be announced in the coming weeks.
The rest of it is basically a re-hash of the announcements from last March – planned investment of more than $20m, with about 300 people to be hired over the next 36 months. GreenTech is still reported as using the revolutionary PIM process, together with patented methods licensed from U S Quest and LBO Capital. The products will be superior in quality to those they replace, typically less expensive, and will help tackle the issue of mixed plastic waste.
This is good news for Environmental Recycling Technologies (ENRT) since ultimately it will receive royalties on any PIM products. Royalties will flow via LBO Capital which has the rights to some PIM products in the US.
It is clear that interest in PIM remains very much alive in the US. Though the PIM encapsulated magnesium parts for the auto industry have gained official acceptance, the cash crisis in the industry means that they are still not being manufactured. It could yet happen, however, as business picks up. Other PIM items like sewer pipes and plastic housing still appear to be struggling to gain acceptance under official building codes.
LBO is clearly delighted to be involved with the Gates Foundation in applying PIM technology in redesigning cold chain containers used in transporting vaccines. Thanks to relaxing on our bulletin board, it was good to see PIM body armour on the Kelly Space website (www.kellyspace.com).
Back in the UK, last week’s ENRT announcement that 34.7m shares had been issued at par (2.5p) to reduce creditors by £868,070 helps strengthen the company. It is encouraging that creditors should be sufficiently confident in prospects to take shares – risk investments - instead of remaining higher in the pecking order should the company hit trouble. This was not part of the Yorkville convertible. While it is slightly disappointing that the company did not feel able to wait in the hope of issuing shares at a higher price, diminishing dilution, the timing of such a move is tricky. A bird in the hand…
With the Daley nonsense effectively settled and a boost to the balance sheet from the share issue, ENRT looks more solid. The shares still rank as speculative, however, and a successful move by 2K Manufacturing from limited production to high volume output of the Ecosheet plywood board substitute remains crucial.
I have a holding in ENRT.
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