A company set up to save rare native animals from extinction in a network of bushland reserves has wound up on the endangered list as it struggles with a A$10 million (about HK$40.46 million) funding gap. Earth Sanctuaries was set up almost 20 years ago by biologist Dr John Walmsley, a charismatic and controversial conservationist who habitually wears a cap made from a dead feral cat, considered a public enemy for wiping out many of Australia's smaller marsupials. The firm rose to prominence in 2000 when it became the world's first conservation company to go public, listing on the Australian Stock Exchange in a A$15 million float. But shares never traded above the issue price of A$2.50 and they closed yesterday at about 20 Australian cents. Last year the company posted a net loss of A$13.69 million on revenue of A$1.49 million. It has announced it will be restructured and will seek a buyer for all its assets, including 10 wildlife sanctuaries spread across South Australia, New South Wales and Victoria, valued at A$15 million. Chairman Don Stammer, a former director of investment strategy at Deutsche Bank, and chief executive Wendy Craik, a former chief executive of the National Farmers Federation, will resign. Dr Walmsley said thousands of rare animals were now at the mercy of the market. He would be forced to close the company and sack 50 staff if he could not raise A$10 million in six weeks. 'While we will do everything possible to ensure that a buyer takes on care of the animals as well, we cannot promise anything,' he said. 'So we could see 3,000 endangered animals perish and this would be the greatest loss this generation has ever seen.' The failure of the project has raised questions about whether wildlife conservation can ever be commercially viable. While the aim of Earth Sanctuaries was commendable, it never captured the imagination of big business. Main shareholders included Dr Walmsley, who owns 22 per cent of the company, Mr Stammer, who has more than 600,000 shares or 2.4 per cent of the total, and some ethical investment funds. Dr Walmsley admits that most of the 29 million shares were bought by 'mums and dads, ordinary Australians passionate about conservation'. The first Earth Sanctuary was established in 1985 at Warrawong, outside Adelaide, and provided a model for the rest. Areas of bushland were bought up, fenced, and cleared of introduced predators such as foxes and feral cats. They were then stocked with rare native mammals, many of them on the verge of being wiped out. The centres made money from entrance fees, on-site cafes and merchandise, as well as supplying educational material to schools. From a conservation point of view, the sanctuaries have been a huge success, saving at least four species from extinction, including the numbat and the rabbit-sized brush-tailed bettong. But they failed to attract enough big backers to their plans for further development. Greg Follent, a director of financial services company Challenger Corporate Finance, which is assisting in the asset sale and restructure, said: 'Some of the specialist ethical funds looked at investing but people questioned, and rightly so, whether the returns were going to be there. 'Some of the sanctuaries have shown they can be self-financing and self-supporting. Other sanctuaries are too remote to attract many visitors. Those will be the first to be sold. I think in a restructured and slimmed down version Earth Sanctuaries could work, but not in the form they are at the moment.' Earth Sanctuaries is spending A$1.5 million a year more than it earns. The company raised A$12 million on listing in 2000 and has raised a further A$18 million since - but it is not enough. Dr Walmsley said he had intended to build three more sanctuaries outside Sydney and Melbourne, in the hope of attracting more visitors, but ran out of money. Fencing the sanctuaries had proved particularly expensive. He believes a problem of perception lies at the heart of the company's troubles. 'I think people thought it was too good to be true,' he said. 'They could not believe they could make money out of something that was trying to help the environment. 'I could never communicate it properly to the market place. It was like trying to discuss Christianity with the Taleban.' Dr Walmsley will manage Earth Sanctuaries until more funds can be raised, or a suitable buyer found. Mr Follent believes the venture can still be profitable, given the right business plan. 'It was a question of not getting the balance right,' he said. 'At some sanctuaries the conservation objective over-rode the commercial objectives, and they paid the price for that.'