Adm Energy Regulatory News (ADME)

Pan Pacific Aggregates plc

("PPA" or the "Company")

Proposed Company Voluntary Arrangement, Placing and Open Offer

Pan Pacific Aggregates plc (AIM:PPA), a quarry operator in British Columbia, today announces a further update.

Following the announcement of the company restructuring and rescue plan on 11 May, Kingston Smith and Partners LLP, who are assisting the Company in this matter, have today sent out a letter to all the Company's shareholders and creditors. This includes a formal notice to members, firstly to approve the Company Voluntary Arrangement ("CVA"), and secondly, following approval of the CVA, considering, and if thought fit, passing resolutions to obtain authorities from members in relation to fund-raising. A meeting of shareholders will be held at 3pm on Tuesday 6 June 2011 at Kingston Smith's offices at Devonshire House, 60 Goswell Road, London, EC1M 7AD.

The letter includes a link to Kingston Smith's website where shareholders and creditors will be able to view a copy of the Directors' proposals, a summary statement of affairs, a copy of the Nominee's comments on the proposal, a schedule of Kingston Smith & Partners LLP's charge out rates and policy regarding the recharge of disbursements and rule 1.19 and 1.52 of the Insolvency Rules 1986 relating to requisite majorities at creditor meetings held to consider the proposals.

The letter includes an introduction to the proposed CVA and to a proposed placing by the Company.

Proposed Placing

The Board is proposing that Pan Pacific raise up to £3 million (net of expenses) by way of a Placing.

The Board is also proposing an open offer to existing shareholders of up to £2 million on the same terms as the proposed placing ("the Open Offer"). Further details of the Open Offer will be sent to qualifying shareholders shortly.

Shareholder approval is required in order to allow the Placing and the Open Offer to proceed.

Subject to shareholder approval at the General Meeting, the net proceeds of the Placing and proposed Open Offer will be used to fund 18 months working capital, the next phase of development at Quadling quarry and to identify a suitable acquisition target for the Company.

If the Resolutions are duly passed it is the Board's intention to apply for the existing ordinary share capital to re-commence trading on AIM and for admission of the Placing Shares and Open Offer shares to trading on AIM prior to 17 July 2011 which would be the date on which the Company's listing would otherwise be cancelled.

Importance of vote

As at 20 May 2011, being the latest practicable date prior to publication of this document, the Group had cash balances of approximately £63,000 and over the short to medium term the Board expects that the Group will continue to experience net cash outflows.

If the Placing does not proceed and the Group continues to experience net cash outflows, it would need to obtain appropriate alternative financing within a short timescale in order to safeguard the Group's ability to continue as a going concern. Given the timescales involved, it is not certain that the Group would be able to obtain any such alternative financing on commercially acceptable terms, or at all. Consequently, if the Placing does not proceed and the Group is unable to obtain alternative financing, there would be a material uncertainty as to the Group's ability to continue as a going concern.

Accordingly, the Directors believe that the Placing is in the best interests of Shareholders as a whole.

In order for the Placing to proceed, the Resolutions to be proposed at the General Meeting must be passed. The Directors therefore believe that it is very important that Shareholders vote in favour of the Resolutions at the General Meeting.

- Ends -

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