Mariner Seafoods loses creditor shelter
A P.E.I. Supreme Court judge has lifted a court order protecting Mariner Seafoods from its creditors, increasing uncertainty about the insolvent firm's future.
The company, based in Montague, P.E.I., went into receivership last January owing more than $11 million.
Mariner Seafoods, which employs 250 people, was placed under court protection under the Companies' Creditors Arrangement Act. It has continued to operate and a receiver was put in place to negotiate with creditors.
But efforts to reach a financial settlement fell apart, leading the judge to remove court protection.
P.E.I. Innovation Minister Allan Campbell said Mariner owes his department $400,000 and he's looking at appointing another receiver.
"We'll be looking to appoint a private receiver to ensure that the assets of that company are protected and that our security remains in place," Campbell said.
"We need to, you know, appoint the receiver, sit down and try and work with the company to hopefully find a way that there's a future for that company in Montague."
The Montague-based development group Active Communities had loaned Mariner Seafoods $2.5 million without security. Active Communities — funded federally and provincially — represents one of Mariner's largest creditors.
Jim Bagnall, Progressive Conservative MLA for the area, said Active Communities voted against the proposed settlement, which would have meant almost a total loss for the group of creditors.
"To be one of the main instigators in closing down a 250-job operation in the community — I'm disappointed," Bagnall said. "The Liberal government here in this province has to step forward."
Mariner workers said they are feeling stress over concerns about their future.
The extent of Mariner's assets isn't clear. Company president Mark Bonnell has suggested they essentially represent just an old building in Murray Harbour.
Mariner Seafoods, however, hasn't operated there for years. Its fish processing has been taking place at the Montague Cold Storage plant, owned by Bonnell's sister, Linda Love.
Love is also suing Bonnell for $500,000 for an unpaid loan.
Bonnell, who declined to be interviewed Wednesday, is himself listed as a large creditor of the company, with $5.5 million owed.