MOOSE JAW – About 100 workers returned to their jobs June 12, more than a year after the pork processing plant that employed them and 170 others shut its doors.
They came back as employees and owners. Through a labour-sponsored venture capital corporation, the workers now own a chunk of the company formerly known as Worldwide Pork.
It’s now called Moose Jaw Pork Packers Ltd. and the shareholders also include former creditors of Worldwide, new private investors and the South Central Community Futures Corp. Total investment to reopen the plant was about $3 million, said chief executive officer Don Fancourt.
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The provincial government contributed $1.5 million, or the amount of debtor-in-possession financing required to reopen the facility. It converted $2.3 million in debt to equity in the new company as well.
The former owner is not involved.
Fancourt said it was the willingness of employees, producers, lawyers and government to persevere that led to a successful restructuring while under court protection.
Moose Jaw mayor Al Schwinghamer described it as “the Saskatchewan way.”
The plant closed in May 2005 after it couldn’t pay suppliers and producers stopped delivering hogs. Fancourt, from Kitchener, Ont., came on board earlier this year after a 38-year career in the meat industry with Canada Packers and JM Schneider.
Standing in what is usually the freezer area of the plant, he told reporters that Moose Jaw Pork Packers would take a different marketing approach than Worldwide.
“He was heavily oriented toward exporting,” Fancourt explained of former owner Kenji Nose. “We also plan to do domestic work … diversify our markets.”
Export markets will include South Korea, Russia, Australia and Japan. Worldwide shipped exclusively to Japan. Once the plant is processing between 1,100 and 1,200 hogs per day, another 50 to 60 people will be employed. Some of the employees moved to other jobs or out of province during their long layoff.
“We’ve got the senior people back that we need to operate the organization,” said Fancourt.
They’ve also got producers back. Suppliers will include local producers and Hutterite colonies from Saskatchewan, Alberta and Manitoba.
John Kleinsasser, a minister at the Rose Valley Colony southeast of Assiniboia, Sask., said the colony shipped to Moose Jaw since 1969.
“It’s the best market in Western Canada,” he said.
Although Worldwide owed Rose Valley more than $200,000, Kleinsasser said the colony was happy to be a shareholder and supplier to the new company.
The colony expects to save between $1,100 and $1,200 each week on freight costs. It has been shipping to Maple Leaf’s plant in Brandon.
“This plant is capable. I’m totally confident,” Kleinsasser said.
“We know they did not leave any stones unturned.”
So impressed was he with the restructuring plan that Regina lawyer Rick Van Beselaere, who represented Worldwide during the process, is one of the private investors.
He said he was careful to avoid a conflict of interest. This is the first and “probably the only time” he has invested in a company with which he was involved in restructuring.
“The model that’s been built is extremely attractive,” he said.
The committed employee base is key.
“A well experienced motivated group … goes right to the bottom line,” said Van Beselaere.
Saskatchewan agriculture minister Mark Wartman said the province has 7.7 percent of Canada’s hog production. But with more than 40 percent of the feed grains and so much space, the opportunity is endless. Increasing slaughter capacity is a cornerstone to development, he said.
