Veneer plant files for Chapter 11 bankruptcy
The struggling Ketchikan company is seeking a $5 million loan from the Ketchikan Gateway Borough after having already received $7 million in government financing.
Gateway officials blamed the company’s problems on the expense of building a veneer plant, start-up costs and depressed lumber prices.
"We had a short-term liquidity problem," spokesman Cliff Skillings said.
Chapter 11 bankruptcy protection will allow Gateway to continue to operate while reorganizing, the company said.
Gateway also filed an emergency petition asking the court to allow it to pay the company’s 130 full-time employees.
Gateway has accumulated $37.5 million in debt. Papers filed in federal bankruptcy court in Anchorage said several Ketchikan businesses are among the largest unsecured creditors.