New Harbour licences suspended as OCI, Quinlans buy Daley Brothers assets

Fisheries Minister Gerry Byrne has taken swift action to demonstrate his frustration at the circumstances under which seafood processing plants in New Harbour were closed this spring, and how those assets are now being gobbled up by competitors.

Byrne announced Monday that he has suspended all processing licences linked to crab and groundfish plants in New Harbour.

"As of today, given the concern, the need to have a well-regulated industry, given the circumstances we find ourselves in at New Harbour, I am suspending all processing licences at New Harbour, pending a thoroughinvestigation, and a review of the circumstances around New Harbour and the sale," he said during a telephone interview.

• No crab, no groundfish, no work: New Harbour plants won't open this year, owner reveals

CBCNews has confirmed those plants and their contents were purchased late last week in what's being called a joint venture by seafood giants Ocean Choice InternationalandQuinlanBrothers.

All part of a strategy to secure the crab supply previously processed in New Harbour.

Ocean ChoiceCEO Blaine Sullivan confirmed the transaction Monday, writing in an email that "we bought the two New Harbour plants and any equipment that is remaining on site."

He said the sale did not includethe Woodman Sea Products business, which is owned by Daley Brothers, or a third plant located nearby in South Dildo.

Sullivan declined an interview request.

Robin Quinlan, vice-presidentof QuinlanBrothers, also declined comment, saying he would release a statement in the coming days.

Neither would say whether there are plans to resume processing operations in New Harbour, though one source close to the deal said such ascenario would be a "miracle" because of sharp quota reductions and poor landings of species such as crab this year.

Mixed messages from companies

Byrne said he was told by Quinlanthatthe processinglicenceswere included in the deal, while an executive withOCIsaid they were not.

Byrne said he is not happy about what he called "confusing and contradictory" information, andsaid no one should assume that he will rubber-stamp any transfer of licences.

"It's essential that our seafood processing industry be managed for the public good, that it be well regulated for the public good. This isnot meeting this test at this point in time," Byrne said.

It's essential that our seafood processing industry be managed for the public good, that it be well regulated for the public good. This isnot meeting this test at this point in time.- Gerry Byrne

Sullivan confirmed OCI"does not have an interest in the licence."

The plants were previously owned by Daley Brothers, another well-known name in the Newfoundland and Labrador seafood industry.

Byrne isirritated by the flow ofinformation from the companies, and said it's hurting the provincial government's ability to provide assistance to the dozens of employees displaced by the closure.

Daley Brothers announced April 20 that it had no plans to operate the plants this season, telling employees the business was no longer viable.

The Daleys have shifted their focus to New Brunswick, where they are now managing a lobster-processing plant in Tracadie-Sheila.

Lack of information stalling government aid

In order for government assistance programs for workers to kick in, the plant owner must confirm that a closure is permanent.

Byrne said he has been unable to get a straight answer from the Daleys, and he learned only today that the plants have been sold.

The minister said these are very challenging times in the processing sector, and he wants workers to be front of mindwhen tough decisions are being made about whether to operate a plant.

Dramatic reduction in processing industry

"That information (should) be conveyed proactively wherever possible so that interventions can be made in advance to limit or reduce or minimize that pain and that anxiety and that upset," said Byrne.

"That's only fair. That's not occurring in this particular example."

The processing sector has undergone a dramatic rationalization in recent years, with the number of shrimp plants dropping from 13 to seven.

Eight years ago, meanwhile,there were 35 crab processing plants, but this year, 24 are in operation.

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