Western Alaska fishing company makes plans to go public

Posted: Thursday, August 07, 2003

ANCHORAGE (AP) Executives of a major Bering Sea fishing company representing several Western Alaska villages are negotiating in New York and Toronto to take the company public.

Coastal Villages Region Fund is at the center of plans to turn American Seafoods of Seattle into a company whose shares are bought and sold on stock exchanges.

Anchorage-based Coastal Villages is the biggest single owner of American Seafoods, with almost 40 percent of the stock.

Only five publicly traded companies are headquartered in Alaska, and few if any publicly traded companies Outside have Alaskans, especially residents of tiny villages such as Hooper Bay, Chevak and Quinhagak, as the major shareholders.

Morgen Crow, executive director of Coastal Villages, said the IPO could happen as soon as this fall, once the U.S. Securities and Exchange Commission gives final approval.

According to the latest prospectus filed with the SEC, the American Seafoods IPO is expected to generate $523 million in proceeds, which could give Coastal Villages cash to make more investments in the Bering Sea fishing industry and also to develop the economies of the 20 Kuskokwim River-area villages the company represents.

Coastal Villages is one of six companies established in the early 1990s to represent groups of Western Alaska villages under the federal Community Development Quota program. The program awarded about 10 percent of the Bering Sea's lucrative commercial bottom fish harvest, chiefly pollock, to the six companies. The companies annually harvest their shares of fish for the benefit of their respective villages.

The six companies technically are nonprofit, though they're very much profit-driven. Some have banked tens of millions of dollars, bought huge fishing vessels and built village fish-processing plants.

Over the years, Coastal Villages bought increasingly into American Seafoods, a company that owns the largest fleet of Bering Sea pollock ships. The company also has a seafood processing plant in Massachusetts and the country's largest catfish-packing operation in Alabama.

Today, Coastal Villages has more than $50 million in total assets and it expects that figure to rise substantially after the IPO.

Mike Hyde, president of American Seafoods, said a main goal of the IPO is to create publicly traded shares that owners in the company, including New York investment firm Centre Partners, can easily cash out. The American Seafoods shares would be traded initially on the Toronto Stock Exchange and later on the American Stock Exchange in New York.

''Really, nothing will change as far as the operation or control of the company,'' Hyde said.

To investors, American Seafoods is touting the abundance of Bering Sea pollock, a whitefish used for fast food or to make goods such as artificial crab, as a strength of the company. American Seafoods holds near-guaranteed rights to catch close to 20 percent of the pollock harvest under a federal fishery law Congress passed in 1998.

According to the prospectus, the company had profits of nearly $22.3 million in 2002 on seafood sales of about $332 million. But it also listed $529 million in long-term debt at the end of last year, up from $177 million at the end of 2001.

Crow said Coastal Villages will go through the sale only if it holds strong promise of helping his villages.

On the Net:

American Seafoods prospectus: www.sec.gov/edgar/searchedgar/webusers.htm

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