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Former sardine cannery sells at auction for $900,000

Posted Sept. 26, 2012, at 2:19 p.m.
Last modified Sept. 26, 2012, at 7:10 p.m.
David Garbo (left) and Michael Tourkistas pose Wednesday, Sept. 26, 2012, outside the former Stinson Seafood plant in the Gouldsboro village of Prospect Harbor. The companies run by the two men, Garbo Lobster and East Coast Seafood, teamed up to come up with the winning bid of $900,000 for the plant, which was sold Wednesday in a foreclosure auction ordered by TD Bank. TD Bank foreclosed on the property after it determined that Live Lobster, which bought the plant in 2010 from Bumble Bee Foods, had not lived up to the terms of a loan agreement established between the bank and Live Lobster in 2008.
David Garbo (left) and Michael Tourkistas pose Wednesday, Sept. 26, 2012, outside the former Stinson Seafood plant in the Gouldsboro village of Prospect Harbor. The companies run by the two men, Garbo Lobster and East Coast Seafood, teamed up to come up with the winning bid of $900,000 for the plant, which was sold Wednesday in a foreclosure auction ordered by TD Bank. TD Bank foreclosed on the property after it determined that Live Lobster, which bought the plant in 2010 from Bumble Bee Foods, had not lived up to the terms of a loan agreement established between the bank and Live Lobster in 2008.
In this photo taken in June 6, 2012, dozens of workers — many of them Filipino — pick through cooked lobster meat at a Paturel processing plant in Deer Island, N.B. Paturel is the processing division of East Coast Seafood, which is partnering with Garbo Lobster to buy the former Stinson Seafood plant in the Gouldsboro village of Prospect Harbor.
In this photo taken in June 6, 2012, dozens of workers — many of them Filipino — pick through cooked lobster meat at a Paturel processing plant in Deer Island, N.B. Paturel is the processing division of East Coast Seafood, which is partnering with Garbo Lobster to buy the former Stinson Seafood plant in the Gouldsboro village of Prospect Harbor.

GOULDSBORO, Maine — An idle seafood processing plant in the local village of Prospect Harbor was bought Wednesday morning at a foreclosure auction for $900,000.

The new co-owners are Garbo Lobster, a lobster distribution company based in Groton, Conn., and East Coast Seafood, a global lobster distributor based in Lynn, Mass., that also has a large lobster processing facility in New Brunswick, Canada.

After Wednesday’s auction, David Garbo, president and CEO of Garbo Lobster, said he and East Coast Seafood President and CEO Michael Tourkistas are optimistic about restarting the Prospect Harbor plant and about Maine’s growing processing sector. Garbo Lobster has a facility in Hancock, Maine, about 20 miles from Gouldsboro.

Garbo and Tourkistas each said they do not know how soon operations at the plant will resume or what level of processing capacity it will have when it does. The plant will need investment — with state and federal assistance in grants and loans — in order to make it a viable endeavor, according to Garbo, but he did not say how much money they expect to invest.

“We obviously see some potential in the plant,” Garbo said.

“We’re going to work together with Dave Garbo and see if we can make this work,” Tourkistas said.

In 2010, the Gouldsboro plant was bought by Live Lobster, a Chelsea, Mass.-based lobster distribution company seeking to get into lobster processing, from Bumble Bee Foods. There were 128 people employed at the facility, the last sardine cannery in the United States, when Bumble Bee closed it down in April 2010.

Live Lobster built a lobster processing line in the plant, which had been a sardine cannery for more than 100 years, and in the summer of 2011 had 70 employees working there. But operations came to a sudden halt in March of this year when TD Bank froze Live Lobster’s checking accounts and then, the following month, filed a lawsuit against Live Lobster, claiming Live Lobster had failed to make loan payments and deposited some of its proceeds with another bank, which TD Bank claims is a violation of a $4 million loan agreement it reached with Live Lobster in June 2008.

According to federal court documents posted online, TD Bank voluntarily dismissed the lawsuit against Live Lobster in July. A second lawsuit filed against Live Lobster by a former company official and minority owner still is pending in federal court in Massachusetts.

Live Lobster has not resumed operations in Maine since TD Bank froze its accounts. Wednesday’s foreclosure auction was arranged by the bank and conducted by Tranzon Auction Properties. Multiple attempts to contact Live Lobster officials since its accounts were frozen, including attempts on Wednesday, have been unsuccessful.

Gov. Paul LePage and lobster industry officials in Maine have called for increasing the processing capacity in the state in order to boost the value of Maine’s lobster fishery. Maine lobster fishermen caught more than 100 million pounds of lobster in 2011, for which they were paid more than $330 million. But much of what they catch is processed in Canada and then imported back into the United States for consumption.

Robert Bayer, executive director of the Lobster Institute at University of Maine, said Wednesday that the combination of East Coast Seafood and Garbo Lobster partnering in the facility bodes well for its future. Garbo has the buying stations established in Maine — and others in Canada — that will be key to supplying the plant with fresh lobster, he said, while East Coast Seafood has the processing expertise and global distribution network. East Coast Seafood generally buys its lobster from smaller dealers, rather than directly from fishermen, Bayer said.

“For processing, they’re the premiere company,” Bayer said of East Coast Seafood. The company’s Paturel subsidiary owns and operates a lobster processing plant on Deer Island in New Brunswick, just over the border from Eastport, which is “an amazing facility,” he added.

Bayer said the Lobster Institute has close ties to Tourkistas’ firm and may be able to coordinate research projects with the company at the Gouldsboro plant.

“I think it’s a brilliant combination,” Bayer said of the partnership between Garbo and East Coast Seafood. “I can’t imagine anything better, really.”

This past June, the Lobster Institute gave Tourkistas its annual Rising Star Award for his company’s development and educational initiatives in collaboration with the Lobster Institute. The award was presented to Tourkistas during Lobster Academy, a learning experience for industry members held in St. Andrews, N.B.

About 50 people, many of them interested Schoodic Peninsula residents, attended Wednesday’s auction of the Gouldsboro plant, held at 10:30 a.m. in the upstairs hallway of where the facility’s offices are located. Several former Stinson employees — including longtime cannery line worker Lela Anderson, who worked packing sardines at the plant for more than 50 years — were on hand to observe the bidding.

According to Gouldsboro Town Manager Yvonne Wilkinson, the 11-acre, waterfront parcel where the plant is located has an assessed value for tax purposes of $2.2 million. There are a few other properties in Gouldsboro that were included in Wednesday’s auction of the plant, she said, with an additional assessed value of roughly $230,000, making the total assessed value of all the properties $2.44 million.

“It is exciting,” she said of the plant having new owners well-established in the lobster and seafood industries. She declined to comment further.

Gouldsboro Selectman Roger Bowen said Garbo has a good reputation and local residents are hopeful he can make a go of it.

“He knows the business, hence there’s no need to develop a new business plan,” Bowen said. “He has a good reputation among lobster buyers and I’m hoping, as we all are locally, that he will bring back and restore some of those jobs that were lost.”

Also auctioned off Wednesday in Gouldsboro were several trucks, two semitrailers, a fishing boat and a front-end loader that Live Lobster had used as part of its business. These items were auctioned off separately from the former cannery and were bought piecemeal by smaller commercial fishing operations.

As a result of the bank’s foreclosure, a dock and buying station owned by Live Lobster in Stonington was auctioned off Wednesday afternoon.

According to a Tranzon official, Antonio Ramos made the winning bid of $1.6 million on that property. Ramos is a property owner and quarry operator in Stonington.

A lease held by Live Lobster on commercial wharf in Phippsburg is expected to be auctioned off Thursday.

The Associated Press contributed to this report.

Follow BDN reporter Bill Trotter on Twitter at @billtrotter.

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