Shipyard’s new owner hopes for calmer financial seas
As Harbour Grace Ocean Enterprises navigates its way out of financial trouble, its new owner is charting a new course for the shipyard.
In November 2023, the company filed for creditor protection, citing several factors as contributing to its financial difficulties.
Supply chain issues, a downturn in the fishery and inflation — all caused by or exacerbated by the COVID19 pandemic — combined to create problems for the Harbour Grace facility.
It ran out of cash and had no access to further credit, making it difficult to complete contracted projects and pay its nearly 60 workers.
NEW OWNER
Through court proceedings during the winter months, the shipyard was eventually sold to Green Skiff Investments Inc., a company owned by Blaine Sullivan, president of seafood titan Ocean Choice International.
Green Skiff, a company Sullivan uses to hold shares and invest from, was granted ownership of the shipyard by the Newfoundland and Labrador Supreme Court in early February.
“They have done work for us in the past and we were pleased with the quality of the work,” Sullivan told The Telegram of the reasons why he was interested in the shipyard.
“They are a local company the location is good. I had a look through (the facility) and spoke with management and they seemed keen to get on with it and work with a new owner.”
‘NEED TO INVEST’
Sullivan knows how valuable the shipyard is to the local economy and to the fishing industry, too.
The full complement of staff has been retained throughout the process.
“There was some talk where you might see someone buy it and sell off the parts, and that would be a real shame,” he said.
He says the shipyard’s woes can be largely attributed to the pandemic and he is confident it can get back on its feet and become a viable business once again.
“We need to invest in infrastructure there and make sure people are better-tooled to do the job,” said Sullivan.
“They need to be able to get up to larger-sized vessels. If they have the right tools to take on projects, it’s going to make it a lot easier to get it to work.”
Details of the development plan for Harbour Grace Ocean Enterprises are still in the works.
WADING THROUGH THE LEGALITIES
The process has not been without its challenges, and there are still some legal wranglings weaving their way through the court process.
Gray Enterprise Ltd., a company owned by Kevin English, was the majority shareholder and a secured creditor of Harbour Grace Ocean Enterprises. It made an unsuccessful bid to get the shipyard, and the court ultimately approved the sale to Sullivan.
The court-appointed monitor for the creditor protection is still in the process of settling up how the proceeds from the sale are to be distributed to the shipyard’s creditors.
Sullivan says there is also an issue involving interests in a vessel currently under repair at the yard.
All of that is for the legal people to iron out, said Sullivan, while his attention has turned to expanding the business of the shipyard he now owns.
“I want to focus on getting on with running the yard, making a good plan for the yard and to make sure there is a good amount of work for everybody to make it a success,” he said.
‘NEED A BETTER FACILITY’
The shipyard recently built and launched a large, roughly 400-tonne fishing vessel named Petten’s Legacy.
While that impressive boat was made at the Harbour Grace Ocean Enterprises, the facility doesn’t have the capacity to lift that vessel back up for repairs if needed.
“The maximum at the shipyard now is a certain width and a 330-tonne boat,” explained Sullivan.
“As boats become larger, you have to have the equipment to raise them up. So, that’s the first thing we’re looking at. …
Down the road, if you’re going to be building large steel boats, you’re going to need a better facility to do it.”
TAKES TIME
Sullivan said developing and implementing a plan for the shipyard will take time.
“I’m pretty positive that there’s a good flow of work in the yard,” he said. “Bankruptcy certainly slowed down that flow.
“It wasn’t a good year in the fishery last year but, thankfully, this year is looking much better. I expect a reasonable flow through the yard to keep everybody busy.”
He hopes the major challenges are now behind the company. The unexpected costs that came after the pandemic struck caused a lot of grief on contracts the company was expected to still deliver on, he said.
“There are other things that happened, but that was a big thing,” said Sullivan.
“Inflation is sort of obvious everywhere. I’m not saying that was the only reason — it’s certainly not, but we’re making a good plan and, so far, so good. I think the yard can be a success.”