Prime Tanning files for bankruptcy
Leather processor Prime Tanning, the largest employer in the Somerset County town of Hartland, has filed for Chapter 11 bankruptcy protection.
Company officials said the Hartland facility, which has about 180 employees and is also its headquarters, will remain in operation as it reorganizes, according to the Morning Sentinel. The company named dozens of creditors, including 16 that are owed between $100,000 and $1.1 million, and listed its total liabilities as being between $1 million and $10 million, according to the Bangor Daily News. Prime Tanning owes more than $300,000 to the town in back property taxes and has filed for bankruptcy twice in recent years. In a statement, Prime Tanning attributed its financial troubles to liabilities and legal expenses related to its formerly unprofitable Berwick operation, which the company closed in 2008, as well as Prime Missouri, which it sold in 2009. The residents of northwest Missouri sued Prime Tanning for selling carcinogenic fertilizer to farmers, a case that is still pending.
Paul Larochelle, Prime Tanning's president, said in the statement that the Hartland facility has a "very strong work backlog," and that restructuring will "allow Prime to emerge as a lean and profitable" company, the Bangor Daily News reported. The company has reached agreements with the Maine Rural Development Authority and a firm called Porter Capital to provide loans and financing during the Chapter 11 case, and is in talks with an unnamed private equity firm, its attorney, Robert Keach, told the paper.
Prime Tanning acquired Irving Tanning Co. in Hartland in 2007, as well as Cudahy Tanning Co. in Wisconsin, and in 2008 closed the Wisconsin facility to consolidate operations in Maine. In March 2008, the company merged with China-based Shanghai Richina Leather Co. Ltd., creating the world's largest premium leather maker, company officials reported.
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