There was much excitement, flag waving and children were given a day off school in Liverpool on October 16th last year when glamorous Angela Eagle, Exchequer Secretary to the Treasury ( and significantly MP for Wallasey) , opened the D1 £7m bio-diesel refinery , built on the Lubrizol site, at Bromborough which had created 40 jobs.
Designed to produces oils from inedible raw material Jatropha curcas, a crop which D1 are growing in tropical zones , immediately faced compeitition from the tax boondoggling US "dash'n'splash " trade ,giving producers of the so called B 99 biodiesel fuel a US$1 a gallon subsidy. 80% of of US produced biodiesel reaches Europe.
D1 managers took the chance to tackle Angela Eagle about this "double dip" subsidy regime for US producers and the EU subsidy at the pump. She was reported to say at the time (Liverpool Post) “We are currently taking the necessary steps for the issue to be taken up by the European Trade Commissioner under the World Trade Organisation procedures. This is an important new industry and we need to ensure there is free trade and fair competition.”
Now 6 months later CEO Elliott Mannis has announced that the company has started a "consultation" process with it's employees at both its Middlesbrough and Bromborough sites prio to reducing the workforce.
At the same time founder and first Chairman, Karl Watkin, has resigned as a Non-Executive Director of the Company - he owns some 5% of the shares. On March 20th Watkin said he was ``evaluating all options'' including ``an increase or decrease in his interest, and whether or not to make an offer for the company,'' he said in a statement distributed by the Regulatory News Service today. The Times today note that UBS, the company's biggest shareholder, sold some of its stake.
At the time of his departure Watkin (whose Just2Clicks dot com failed) was highly critical of the City. He said that he had become “increasingly frustrated” over the past year by “the inability of the investment community, governments and NGOs to differentiate D1's strategy from that of the suppliers of palm, soya and rapeseed whose biodiesel products have been well documented as being environmentally unsustainable”. (What also differentiated the company was the ability to hoover up large sums of money and produce zero profits.)
He also complained about the shorting of the stocks which was a feature of illiquid AIM stocks ..."“The majority of companies on AIM have had the stuffing kicked out of them,” he said. “People have been kicking the shit out of the stock.”
See : Tuesday, October 02, 2007 Boondoggling biodiesel - How Uncle Sam subsidises the EU motorist
Wednesday, December 05, 2007 Peter Mandelson makes some slippery remarks about US biofuel boondoggle - fist fight in sight ?
The D1 share price tells the tale.... Down 2.4 p yesterday = 5.4% to 43.5 p