A parting of the ways?

March 17, 2010 11:12 AM

As hard as it may be to believe (and it certainly comes far too late for some New Brunswickers), we may be seeing a parting of the ways between the Atcon Group and the Shawn Graham Liberals. It's a big moment, given how the government once touted Atcon and its CEO Robbie Tozer as a model of homegrown entrepreneurship.

Amid the controversy over the $50 million dollars in loan guarantees last year and the possible imminent collapse of Atcon, the premier and his ministers have been steadfast: yes, the province may have to fork over some or all of the money to the Bank of Nova Scotia, but that was the price of trying to do the right thing: helping a local businessman who wanted to create a world-class company and create (and maintain) jobs in Miramichi.

Tozer himself was on-message when he spoke briefly to reporters after Monday's receivership hearing. "It's really critical that we find some solution," he said, "rather than do what the Bank of Nova Scotia wants to do, which is crash the company." In his most recent affidavit, part of his bid to remove Ernst & Young as the court-appointed monitor, Tozer argued his continued role was "a key element" in ensuring Atcon's future. It's a noble image: Tozer as the champion of his local workforce, fighting the big bad bank.

Except both Scotiabank and Ernst & Young, the accounting firm acting as the court-appointed monitor of Atcon, paint a different picture.

According to Scotiabank, Tozer has repeatedly rejected their advice since they've become closely involved in the effort to salvage Atcon. More seriously, they allege in their affidavit (and this has not been proven in court) that Tozer didn't tell them last month when Shell pulled out of a key Atcon contract in Alberta - a contract that Tozer himself had described as vital to Atcon's ability to stay alive. "As a result, the Bank does not have any confidence in Mr. Tozer's ability to resolve the Companies' problems now," Scotiabank's affidavit says. "The Companies are hopelessly insolvent."

Ernst & Young, meanwhile, says in its affidavit (filed in response to Tozer's attempt to remove them) that their employees based at Atcon's offices have not been able to meet very often with Tozer, whose presence they describe as "sporadic." They also complain that Tozer signed new contracts for Atcon without consulting them about whether there was enough cash flow to do the work.

These are unproven allegations, but they are not flattering portrayals of a man on whom the government has wagered tens of millions of taxpayer dollars. We asked Finance Minister Greg Byrne about this yesterday; he declined to comment. But when we asked him what he thought of Tozer appealing the receivership order and trying to remove Ernst & Young as the court monitor, Byrne made a very interesting comment.

"Mr. Tozer is, I'm sure, taking the decisions that he believes are in his best interests and in the best interests of the company," Byrne said. "However, the province of New Brunswick also has to take those decisions that we believe are in the best interests of taxpayers. We support the monitor and the bank in this process."

Did you catch that? The "however" is important: it suggests that Tozer's, and Atcon's, best interests, no longer dovetail with the taxpayers' best interests. And by supporting the monitor, Byrne is implicitly disagreeing with Tozer's decision to challenge them.

For months, critics have asked when the government would realize that it had reached the limits of its support for Atcon. We may be there now.

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