P.E.I.-based lobster processor files for creditor protection from N.B. court
CBC
A seafood distributor based in western P.E.I. is part of a group of companies that has filed for creditor protection in New Brunswick court.
South Shore Seafoods Ltd. and related companies received an order from the Court of King's Bench in Saint John last week. According to court records, the Rosebank-based lobster processor and related companies owe creditors more than $55 million.
In a letter to suppliers dated Sept. 25 and signed by co-owner Timothy Williston, South Shore cited the "extreme volatility" of the seafood industry over the past few years.
"The South Shore Seafood Group of Companies weathered these storms; however, it had a significant impact on its working capital," the letter states.
The letter says South Shore has a restructuring plan and has secured interim financing for continued operations, but that its court-ordered protection prevents the company from using that financing to pay off existing debts.
South Shore Seafoods Ltd. was established as a lobster processor in P.E.I. in the 1990s.
Within the last four years the company was acquired by Williston and Michel Jacob, two shareholders based in Cap-Pelé, N.B.
The two also own Captain Cooke's Seafood Inc., By the Water Shellfish (2012) Inc., Can-Am Lobster & Shellfish Ltd., Bridge Lobsters Limited, Arsenault's Fish Mart Inc. and South Shore Seafoods International, all part of the insolvency proceedings.
Preparations are being made for the potential sale of all or part of the group of companies.
According to court documents the companies have a combined staff of approximately 300 employees, with 270 being part-time or seasonal workers, and 80 per cent of those being temporary foreign workers.
Employment levels are not expected to be affected until November, well after the close of the fall lobster season in P.E.I.
Among the listed creditors, the companies owe a combined $2.8 million to the Atlantic Canada Opportunities Agency and Business Development Canada; a further $789,564 to the Canada Revenue Agency; and $156,512 to the P.E.I. government.
The court protection against creditors runs until Nov. 24, but the documents suggest that date will likely be extended.
This story is part of CBC Health's Second Opinion, a weekly analysis of health and medical science news emailed to subscribers on Saturday mornings. If you haven't subscribed yet, you can do that by clicking here.
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