Lobster Processing Done Deal
at Prospect Harbor
by Sandra Dinsmore
Prospect Harbor lobster processing plant property consisted of six parcels totaling 91+-acres including 1,480+ feet of shore frontage with a 58+ foot pier with a 2,260+ square feet of deck. Five buildings, the largest of which is over 100,000 square feet, lobster processing equipment, three holding tanks, a warehouse, and office. The new owners bought it all for a comparatively low $900,000. © Photo by Sam Murfitt.
When two of the biggest, most competitive lobster dealers in the world joined forces to purchase the foreclosed upon Prospect Harbor lobster processing plant on September 26th, they took the industry by surprise.
As Tranzon Auction Properties described it, their purchase consisted of six parcels totaling 91+-acres including 1,480+ feet of shore frontage with a 58+ foot pier with a 2,260+ square feet of deck. Five buildings, the largest of which is over 100,000 square feet, lobster processing equipment, three holding tanks, a warehouse, and office. David Garbo, of Garbo Lobster Co., Inc., Groton, CT, Hancock, ME, and Nova Scotia; and Michael Tourkistas, president of East Coast Seafood, Lynn, MA, and Nova Scotia and New Brunswick; bought all of the above for a comparatively piddling $900,000.
A year before, in March of 2011, Antonio Bussone, president of Live Lobster, Chelsea, MA, had bought the former sardine cannery for $1.5 million. He then spent $800,000 to $1 million more, turning the cannery into a lobster processing facility.
A year later to the month, after a chequered history of bounced checks, Bussone’s bank, TD Bank, froze Live Lobster’s accounts for failure to make loan payments and for depositing funds in another bank. In April of 2012, the bank foreclosed on the property and auctioned it off to Garbo and East Coast..
Bussone had purchased and installed new lobster processing equipment and had brought the plant up to HACCP (Hazard Analysis Critical Control Point) specifications for seafood. The plant, essentially a turnkey operation, had been empty since April, when the business closed.
Former Prospect Harbor plant vice president and Operations Manager Toni Lilienthal therefore said the new owners would need to check everything. “We knew we were having problems with one of the drains,” she recalled. “It was just plugged up. It didn’t have the right flow to it.” She mentioned that both water and sewage systems needed to be tested, particularly mentioning the boilers and the pumps.
But that’s just the equipment; the new company needs employees. Live Lobster had 70 workers processing lobster. According to Lilienthal those employees working one shift could process 15,000 to 18,000 lbs. of lobster. Asked how many lbs. workers could produce with two shifts, Lilienthal said, “Probably 25,000 to 30,000 lbs.” But, she said, “The area of the processing room is too small. You cannot put enough production through in a day to really make a dent in the amount of lobsters caught in the area.” Asked for numbers, Lilienthal replied, “Between Hancock and Washington counties, probably over 50 million [lbs.].” She added that one area co-op catches 2 ½ million lbs.; another catches 4 million lbs. But despite all that lovely thin-shelled processor quality lobster to be worked upon, neither physical work nor interviews can begin until Garbo and East Coast actually own the Prospect Harbor plant. (The closing date has been set for November 10th.)
With that in mind, Garbo and Peter Daley, who manages Garbo’s Hancock operation, met at the plant on October 9th with Tourkistas, Spiros Tourkakis, East Coast vice president, and Dana Rice, Gouldsboro selectman and lobster dealer, to make plans, so the day those papers pass, work can begin.
Although the emphasis of the plant will be processing lobster, live market product will also be part of the plan. And to supplement the slow months the new owners will be processing other species like shrimp, scallops, and consider processing sea urchin and Maine crab.
Asked if they had a timetable in place, Tourkakis said, “We will start working on the plant after we pass papers and expect to be fully operational [for processing lobster] by June 15th.” He said that once the two companies own the plant, work for live lobster business could start as early as December for the 2012 Holiday season. In fact, prior to making his way up the coast to a meeting with East Coast’s processing arm in Canada the following day, the vice-president had made appointments with several downeast lobster co-ops and with a number of downeast lobster dealers from whom the new Prospect Harbor processing business hopes to buy product. Besides wanting to do more processing in Maine, he said, “If you want military contracts, the lobster needs to be processed in Maine.”
The herring offloading point at the end of the wharf when the the Stinson’s cannery in Prospect Harbor was in operation in the 1990’s. The wharf, waterfrontage, and several buildings are all a part of the property package the new owners will get in the purchase. The cannery was renovated for lobster processing in 2010 by the previous owner. Fishermen’s Voice Photo.
The plant principals say they are pleased at the warm welcome they are receiving from the local communities. They want to make it clear that they plan to be here for a long time and that the re-opening of the plant will be an opportunity for many people. They want the area people to know that Garbo and East Coast are here to work with all parties involved.
Rice, who has sold lobsters to Garbo for some time, when asked how he sees this new and as yet unnamed company affecting his own lobster business, replied, “It is positive.” He added that he plans to do everything he can to help this new operation.
“They’re going to buy as much product locally as they can,” Rice explained, “but they’re not going to set up and buy from individual fishermen.” He said he and the other dealers and co-ops will continue to buy directly from fishermen as they always have. Rice then stated, “Garbo and East Coast are two of the biggest lobster dealers in the world. They have the capital and the infrastructure to process lobsters. If these two guys can’t make a success of this, nobody can.”
Asked if the US and Canada have any differences in processing regulations, Tourkakis replied, “Standards are pretty much the same; Canada’s may be a little more strict.” (Garbo sticks to lobster.)
In response to whether the two companies do other things, Tourkakis replied, “East Coast has a sister company, SeaTrade International, one of the largest scallop processors and shippers out of New Bedford, MA. It also has its own seafood distribution centers in Europe.”
Asked how this new partnership will change what each company already does, Tourkakis replied, “Not much.” He then elaborated, saying, “Each entity is on its own, but in Maine and particularly in Prospect Harbor, [the two companies] are partnering in revitalizing the former Stinson plant and the local community.”
Eighty to one hundred available jobs could do quite a job of revitalizing the communities that make up the town of Gouldsboro. Some jobs may be available almost as soon as the real estate closing, in early November, because, as Tourkakis said the day after the October 9th meeting at the plant, “We have so much work there.”
Although the principals are still working on plans, they would like to see at least 5 million lbs. of lobsters processed between June 2012 and early January 2013. They estimate the plant will process 30,000 to 40,000 lbs. per day.
Timing will be tight: The Prospect Harbor property sale closes on November 10th. The Southwest Nova Scotia fishing season, LFAs 33 and 34, opens 20 days later, on November 30th. The first few days’ volume is always extraordinary.
The atmosphere around the old Stinson cannery, now Maine’s newest lobster processing plant is going to be Full Steam Ahead from November 10th to January 1, 2013. It’s an exciting enterprise started by two industry leaders determined to make Maine processed lobster and their Prospect Harbor plant successful.
“It’s a good thing,” said Rice. “It’s going to be a good thing for everybody.”