Something's in the works: fisheries minister Tom Rideout [Right] issued a news release on FPI on Monday.If it turns out to be true, Clearwater will buy up FPI for about half the value of the income trust proposal, dithered and delayed by the Williams administration until it became useless.
Almost 50 million bucks is less than half the value of FPI's income trust fund proposal.
The impact of government policy is obvious.
Makes one wonder what was the cost per share of Tom Rideout's little dance on the tailgate of a truck in front of FPI's headquarters this time last year and the subsequent decision to prosecute the company for exporting fish.
Curious that exporting undersized fish was one of the ways FPI subsidized it s money-losing groundfish operations. That was very likely something FPI briefed government on in December 2005 when the company let government in on its financial situation and its plans for getting out of the fiscal hole.
That little tidbit did become public until after Rideout's little tailgate party. Odd that, in light of Rideout's very public declarations about the company.
Yes, if Clearwater's debenture issue is intended to finance an FPI purchase, the people of Newfoundland and Labrador should demand a public inquiry into government's (in)action over such a long period. The consequences of what appears to be neglect and bad policy could be dismantling of a company developed with public money with assets sold off for less than their real value. Take a look at a write-down Sanford took last year as a result of the FPI shenanigans.
Don't forget too that, as Bond Papers noted last may, changes to the FPI legislation were intended to make it easier to sell off the company in bits and pieces. Some others have only figured that out now.
But that easy sell-off wouldn't necessarily extend to Clearwater, a company from outside Newfoundland and Labrador and therefore - by definition - one of the foreign demons Danny Williams' administration likes to fight against.
That's where the whole thing gets a bit murky.
The provincial government wants to acquire - completely free of charge - FPI's quotas. If Clearwater wants the whole company or the bits with quota, expect the provincial government to veto the deal or try and squeeze its advantage.
But if Clearwater wants any other part of FPI at all, like say the valuable overseas marketing arm, the whole FPI saga could be over in a matter of a few weeks.
It only took three years to break up a once-proud company, with the help of the provincial government.