The Saskatchewan government plans to ramp up its efforts to shed the assets of its cash-losing meat processing plant at Melfort.
“We believe that government has no role in owning a meat processing plant,” Ag Minister Bob Bjornerud said in a release Tuesday, announcing the province’s plans to find buyers for Thomson Meats Ltd. “Our role is to create an environment for business to succeed.”
The provincial ag ministry, now the sole shareholder in Thomson through the Agricultural Credit Corp. of Saskatchewan (ACS), is “soliciting interest” through a “combination of public advertising and direct contact with potential buyers.”
Thomson will continue to operate while a potential buyer is sought for its assets and operation on a “going concern” basis, the province said.
Proposals to buy the company must be submitted in writing to the ag ministry by no later than noon on June 1, the province said.
Thomson began in 1960 as a retail butcher shop at Naicam, about 50 km south of Melfort. In 1982 Thomson opened its new facility at Melfort and had upgraded to a federally inspected meat plant by 1991.
The company expanded rapidly, going public in 1993 on what was then the Alberta Stock Exchange (now part of the TSX Venture Exchange) as it began shipping meat products throughout Western Canada and the northern territories and sought to expand into markets overseas.
Within a few years, however, heavy debt and underwhelming sales jeopardized the company and by 1998 the province had become the principal stakeholder.
Thomson, which still processes its own brand and lines of meats, in 2006 launched the Saskatchewan Toll Processing Centre, which provides processing services to companies and organizations that plan to bring meat products into federally regulated markets.
The toll processing centre allows start-up companies that outgrow the Saskatchewan Food Industry Development Centre’s facilities at Saskatoon to move into the commercial market.
In its fiscal year ending Dec. 31, 2007, Thomson posted a net loss of over $43,000 on sales of $3.12 million, counting a provincial operating grant of almost $900,000 among its “other income.”