The Government of Prince Edward Island met this morning with the Bank of Nova Scotia to purchase Polar Food’s security with the bank. The purchase means that government will be able to control the disposal of the assets of the company.
The deal will cost government approximately $26 million - which is the amount of the current exposure.
A receiver has been appointed and will begin to sell the assets as soon as possible. The sale does not mean all plants will re-open. The decision about which plants to sell will be based on several factors including:
- the present, widely acknowledged problem of over capacity in the lobster processing industry
- the concerns of the employees
- the best return on government’s financial exposure
- the timely sale of assets to ensure the opening of plants by May 1
- the ability to work with other players in the industry to make the best decisions possible.
A number of Island lobster processors have been contacted and have indicated their willingness both to purchase more lobster and to hire as many former Polar employees as possible.
The process leading toward eventual sale will begin immediately. All efforts will be made to assure the remaining plants will be able to open for the coming lobster season.