Atcon faces possible lawsuit over unpaid bills

Miramichi's Atcon Construction is facing a potential lawsuit from an Alberta-based company for failing to pay its bills, only a few months after receiving $50 million in loan guarantees from the New Brunswick government.

'If I was a New Brunswick taxpayer I'd be concerned that this company could get into further debt using this secured loan which would ultimately become the responsibility of the New Brunswick taxpayers to fund.' Keith Dunn, Tracer Industries

When Business New Brunswick handed out the hefty loan guarantee package in Juneto the prominent Miramichi company, Robbie Tozer, Atcon's president and chief executive officer, insisted that all of his bills were paid.

Tracer Industries Canada, a subsidiary of Houston-based Tyco Thermal Controls, contacted Atcon after hearing Tozer's pronouncement as it tried to recoup $656,000 in unpaid bills.

Keith Dunn, the director of project services for Tracer Industries, said Atcon's delinquency in paying his bill should be a problematic sign for New Brunswick taxpayers.

"If I was a New Brunswick taxpayer I would be very concerned that here is a company which clearly has debt continuing debt, my company and others I'd be concerned that this company could get into further debt using this secured loan which would ultimately become the responsibility of the New Brunswick taxpayers to fund," Dunn said.

The company official acknowledged that he is speaking publicly to put pressure on Atcon to pay its debt. If that debt is not paid by the end of the month, Dunn's company plans to sue Atcon for the remaining $656,000.

The partnership between Atcon and Tracer Industries began when Canadian Natural Resources hired the Miramichi-based company to build tanks for a project in Fort McMurray. Atcon hired Tracer to install insulation in three tanks, a project worth about $900,000.

'Broken promises'

Dunn said Tracer Industries has run out of patience with Atcon after receiving three "broken promises" of payment.

Mark Ledwell, the vice-president of operations and general counsel for Atcon, said in an email the company avoids discussing business operations in the media.

He added, however, that Atcon has been having trouble collecting from companies that it has done work for, so that has made it difficult to pay its suppliers.

"However, what we can say is that we have experienced difficulty in collecting from some of our clients payments for work we have performed and completed," Ledwell said in the email.

"This difficulty has impacted Atcon's ability to pay some of our suppliers in a timely manner. Atcon is working its way through the situation and remains committed to a successful result for all concerned."

No help from N.B. government

The New Brunswick government won't be coming to Dunn's rescue as it tries to get Atcon to finish paying its outstanding bills.

Business New Brunswick says all undisputed claims for payment from within the province were paid up by the end of July, but the $50 million in loan guarantees does not require Atcon to pay off out-of-province companies.

The $50-millionassistancepackage struck between the New Brunswick government and Atcon HoldingsInc.includes three loans:

• A $20-million loan guarantee to refinance an existing high-interest loan. This loan must be repaid in June 2010.
• A $20-million loan guarantee to increase Atcon Holdings' operating credit, allowing the company to bid on additional projects outside N.B. This loan guarantee must be repaid in 2013.
• A $10-million loan guarantee to complete the expansion of Atcon Industrial Services Centre in Miramichi. This loan guarantee cannot exceed eight years