State commits more money for ailing seafood plant

Posted: Wednesday, October 09, 2002

ANCHORAGE (AP) -- The state again has come to the rescue of a fish factory in South Anchorage, agreeing to pour up to $2.5 million into the venture.

So far, the Great Alaskan Seafood Co., formerly known as Alaska Seafood International, has been a bust since it began in the late 1990s in a building erected with $50 million in state dollars.

The huge plant with its sophisticated equipment and posh offices is surrounded by acres of empty parking lots. Only a fraction of the 450 employees once envisioned now work there.

In recent weeks, the company was essentially dormant as the three main owners -- a New York investment company, a Taiwanese bank and the Alaska Industrial Development and Export Authority -- worked toward yet another revival plan.

On Tuesday, that plan unfolded as the authority, a state lending agency that serves as the fish company's landlord, shipped out $2 million and committed up to $500,000 more in the spring.

At least twice before, the state has loaned or given the struggling seafood company millions of dollars, as well as forgiving or deferring rent on the 202,000-square-foot building. In a 2001 bailout, the state became an owner of the company as well as its landlord.

Jim McMillan, acting AIDEA executive director, said he still has faith in the company.

''They have the right people on board that have the ability to carry out the business plan -- people with experience in not only the seafood industry but manufacturing,'' he said.

Asked how much cash the seafood company had on hand before the deal Tuesday, McMillan said: ''I don't know how much.''

The company this week announced that Philip Fitzpatrick, formerly with Bumble Bee Seafoods and Dole Food Co., is the latest in a string of chief executives at Great Alaskan.

McMillan laid out terms of the latest refinancing:

On Tuesday, the development authority paid $2 million to buy 15.5 vacant acres the seafood company owned near the plant.

Of the $2 million, the authority gave $870,000 to Bank SinoPac of Taiwan to pay off a first deed of trust it held on the land. The rest, $1.1 million, went to Great Alaskan to operate the plant.

The authority will give the seafood company up to $500,000 more in the spring if it requests it. In exchange, the authority's 8 percent ownership stake would increase.

The state will be fully protected because the land it bought has been appraised at $2.6 million, McMillan said.

Co-owners Bank SinoPac and Sunrise Capital Partners of New York have agreed to chip additional sums into the fish plant, but McMillan would not say how much. Sunrise is the majority owner.

Existing and predominantly Seattle-based seafood processors who buy the bulk of Alaska's fish catches have predicted that Great Alaskan cannot succeed in Anchorage because of its distance from fishing grounds and seafood consumers in the Lower 48.

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