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Alaska Seafood International lays off half its workers

Posted: Tuesday, April 09, 2002

ANCHORAGE (AP) -- Alaska Seafood International has laid off half its work force since January, but company officials say many of the cuts may be only temporary, pending several prospective sales orders.

At the first of the year ASI was running three shifts and employed about 170 workers, production manager Dale Girvan said at the time.

Two shifts have been cut, and the work force has been trimmed to 45 production workers and 40 administrative positions, Girvan said.

In early December, the company sent air shipments of Alaska-caught salmon, halibut and cod to markets in England and the Lower 48, company officials said. Also that month, ASI shipped its first 30,000-pound container of processed fish to Seattle for transfer to an Illinois distributor that supplies restaurant chains and institutions.

In January, Albertsons, a major West Coast grocery chain, and membership-based warehouse retailer Sam's Club began selling ASI's value-added seafood, such as appetizers, dinners and salmon steaks under private labels and with the Great Alaskan Seafood Co. brand name.

The bulk of the orders have been filled, Girvan said.

''We're still producing but not in the volume we were,'' Girvan told the Alaska Journal of Commerce. ''Peaks and valleys, that's part of the fish business.''

Girvan said he expects business to pick up soon.

''There are a lot of things on the cusp,'' he said. ''I expect things to break loose at any time.''

Russell Schreck, ASI's new chief executive and board chairman, said the number of layoffs given by his production manager and other sources were not accurate, but he would not be specific.

''We got rid of some dead wood,'' Schreck said.

Schreck said several sales for the seafood plant are pending, but refused to give additional information.

''We are a private company,'' Schreck said.

That's not entirely the case.

The Alaska Industrial Development and Export Authority has invested about $50 million in ASI and owns title to the company's buildings and land. Alaska law requires the Legislature to approve AIDEA projects of more than $10 million.

The investment by the state beginning in 1993 was made to create new markets for Alaska seafood products and with a promise of 450 year-round, full-time jobs.

ASI, however, has been hampered by financial problems from the onset.

Shortly after construction was completed of the 202,000-square-foot South Anchorage facility in early 2000, Bank Sinopac, a major Taiwanese investor, did not extend a promised line of credit for operating capital. That nearly sank the $125 million seafood manufacturing plant.

In a complex restructuring deal, Sunrise Capital Partners LP put $5 million in equity into the ailing company and arranged a line of credit to begin operations last spring, in time for the summer fishing season.

In return, Sunrise became the majority owner, followed by AIDEA, Bank Sinopac, and a group of individual investors, including founder Howard Benedict.

Sunrise is associated with the New York investment firm Houlihan, Lokey, Howard & Zukin, which specializes in turning around troubled companies.



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