“We are ready to build,” Pasta D’Aurum president Al Iafolla said six months ago.
Six months before that he said the company was going to sell shares on the Alberta Stock Exchange.
And nearly a year before that the company announced it had purchased $40 million worth of pasta machinery from an Italian manufacturer.
None of the plans came to fruition.
Iafolla and his team appear to have consistently jumped the gun with major announcements about the $60 million pasta plant proposed for Swift Current, Sask.
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Perhaps the best illustration of this overeagerness was the sod-turning ceremony that took place in Swift Current in September 1997. Two and a half years later not one brick has been laid.
“She’s still barren land,” said Swift Current economic development officer Marty Salberg.
Shareholders like Trevor Moe are fed up with Iafolla’s pronouncements.
“That’s one of the blunders that has happened with the Pasta D’Aurum project, there was sometimes too much talk and not enough action,” said the Swift Current businessperson.
“That’s a mistake to do that with this magnitude of a project.”
Shareholders took steps at a recent meeting to restructure the company and it appears Iafolla will have a reduced role in the new structure.
Iafolla is outraged by shareholder accusations that he has misled them.
“People can open their mouths and criticize, but you know what, come and step in my boots … and put your money where your mouth is,” he said during a telephone interview.
“Where would the project be right now if I would have said a year ago, ‘I’m not going to make any more comments, to hell with it? I’m not putting any more money in. The project is dead.’ Would they have preferred me to be that way?”
Iafolla said people have misconstrued his comments or simply forgotten what he said. He said he has always clearly stated that every major announcement was subject to financing arrangements.
Iafolla said it isn’t his fault if deals he announced fell through after the fact.
The deal involving $40 million worth of pasta manufacturing equipment was shelved when Pasta D’Aurum couldn’t come up with the required financing.
The concept of becoming a publicly traded company was kiboshed when a key player in the complex arrangement folded.
“People forget the facts,” he said. The deal to list on the Alberta Stock Exchange through a reverse take over of Lauzon Computer Software failed because “Lauzon died,” he said.
And the reason Pasta D’Aurum is no longer “ready to build” is that a KPMG report assessing the viability of the project determined that it is operating under the wrong kind of business structure, said Iafolla.
“Am I a sage? Can I foretell what is going to come out of a report until it’s done by an independent auditor?”
Moe is confident the project will get “back on track” under its new limited partnership structure, approved by shareholders at a March 31 meeting in Swift Current.
“We have nowhere to go but to improve, I guess,” he said.”We’re still united in the fact that we want to get something done.”
Under the new structure, Pasta D’Aurum will cease to exist as a corporation. Shareholder interest in the company will be funneled into an as-yet-unnamed limited partnership.
Local businessperson Keith Brown is a shareholder in Pasta D’Aurum and sits on the board of directors of the recently formed partnership.
“The strategy and decision-making will now flow forward from the general partnership,” he said.
Don’t jump the gun
A big part of that strategy will be making sure deals are set in stone before they are publicly announced.
“We have decided collectively that any communication to the media from now on with respect to this project will be a reporting of factual events as opposed to speculation,” said Brown, who also chaired the March 31 shareholder meeting in Swift Current.
“Certainly there has been ample speculation in the past about events before they happen.”
Brown said the concept of producing semolina and pasta somewhere on the Prairies is still a viable and workable idea, but he admits the financing is not in place yet to build a plant. Raising equity under a limited partnership should allow the company to attract larger investors.
Iafolla insists he will be on the new partnership’s board of directors.
Brown refused to specifically address that issue, but his comments seem to suggest that will not be the case.
“The people who are involved in the general partnership per se and who I think will be involved in its future are generally speaking not the same people who were involved in Pasta D’Aurum.”
Brown said the new team that will be directing the project is a crackerjack squad.
“We believe that the general partnership will move forward with a number of sophisticated and very able people participating in the project.”
Moe is also convinced.
“Some big hitters are going to be on the board, which should help us with the forward movement we need to get it done.”
The city’s economic development officer also sees the new structure as a good omen.
“A lot of opinion was (Pasta D’Aurum) was a dead horse,” said Salberg.
“But I guess the horse has a little bit of oats again.”
