A major potato growing and processing operation may soon be resurrected in Lucky Lake, says both the mayor of the village and the former CEO of the Lake Diefenbaker Potato Corporation.
“It’s going to be back next year, one way or another,” said Mark Langefeld, the man who managed the LDPC until it went bankrupt in May.
“The community and the former investors are trying to find investors to try to let them secure the assets back as an ongoing business.”
Ian Schofield, the KPMG trustee in bankruptcy who is overseeing the settlement of the LDPC’s asset, confirmed that a number of bids have been made.
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The LDPC went bankrupt in early May. It owed about $35 million, but only had approximately $11 million in assets. Most of its investors and creditors were unsecured, which means they are unlikely to cover their losses from the sale of the defunct company’s assets.
But the Royal Bank, the Farm Credit Corporation and Sask Water were secured and are now working with Schofield to decide the best way to dispose of the assets. The Royal Bank and FCC are each owed $8 million and Sask Water is owed $9.5 million.
Sask Water president Ron Styles said he is not only concerned with how to regain some of Sask Water’s money, but also with how to disperse the LDPC’s assets in a way that helps the local industry and communities the most.
“Those are the two main things we’re balancing,” said Styles.
Of the three secured creditors, Sask Water has the most interest in ensuring the local industry is left in the best position, said Styles. The other two are mostly concerned with getting as much of their money back as they can.
But Styles said the assets would probably be worth the most if they were kept intact, which would favor a bid that doesn’t chop up the company.
Lucky Lake mayor Barry Alm said local people are hoping someone manages to keep LDPC’s operations together.
“If this thing gets piecemealed, it will be devastating for the whole area,” said Alm, who with many of his neighbors worked for the LDPC. He is still working there, shutting the company down for the trustee.
Alm said he had heard a successful bid might be approved this week, but Styles said he thinks it will still be some weeks. Styles said no bid has been selected by the secured creditors.
Alm said he is still positive that a large potato growing and packing operation can operate and succeed out of Lucky Lake.
Langefeld said the bid he is involved with would include a new flaking operation to be built near the present storage and bagging facilities.
A resurrected LDPC would have a completely new management team as well, said Langefeld.
Since the LDPC went bankrupt, various people, including Langefeld and former Sask Water managers, have been blamed for the mess that lost millions for investors and left the Saskatchewan government with an overbuilt storage network.
But Langefeld said past differences have been put aside.
“They’re all working hard – the new administration at Sask Water – and we’ve just got a major hurdle to get through here. We’re working with them to get that done.”
