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The group that was supposed to rescue fishing giant Primorrybprom from bankruptcy has only worsened the company’s financial woes, increasing debts by more than 200 percent, First Vice Gov. Konstantin Tolstoshein said recently.

Primorrybprom, a conglomerate of fishing boats and hatcheries, reported debts of more than 30 billion rubles ($5 million) last year. To avoid sinking into bankruptcy, the company’s creditor council voted to bring Primorrybprom under arbitrary management and pay off the debts.

But more than 1 1/2 years later, the company now reports debts of over 89 billion rubles ($15 million).

The external management, installed by the Federal Bankruptcy Agency, wasn’t properly trained to handle Primorrybprom’s troubles, said Vladimir Sidorov, Chairman of the Krai Committee for Fishing Enterprises. “The policy carried out by [external managers] was based on selling assets and getting loans, not on developing projects for manufacturing or catching fish,” Sidorov said.

Problems at Primorrybprom became so difficult recently that the Anti-Crisis Management Advisory Council, led by Tolstoshein, met to decide how to rescue the company, whose bankruptcy is hurting business that could survive alone.

At the same time as external management increased Primorrybprom’s debts, the company dragged down the small fish farms under it, Sidorov said.

“External management only worsened the situation,” Sidorov said. “Fishing farm directors now suggest separating from Primorrybprom and getting out of crisis on their own.”

Tolstoshein blamed arbitration manager Alexander Gordienko for most of Primorrybprom’s extensive problems. “We need to replace him as soon as possible because the case continues to get worse with Primorrybprom,” Tolstoshein said. “It seems to me like Gordienko has been paid a lot of money for very little work.”

Gordienko said that the situation was far more complex than Tolstoshein imagined, and that he could not simply absolve all of Primorrybprom’s debts. Beyond that, he chose not to respond to Tolstoshein’s remarks.

After such allegedly disastrous results with external management, the committee will evaluate the bankruptcy agency, as well as its leader, Alexander Sazhnov.

Tolstoshein said, “We need to prepare a letter to the government discussing what has been done by Sazhnov for reviving local industry and helping companies that experience bankruptcy.”

He added that during his tenure as Vladivostok mayor, he sacked Sazhnov, who later became the head of the Federal Bankruptcy Agency’s local branch. “And from now on, candidates for arbitrary managers have to be approved by me,” Tolstoshein said.

Andrei Makarov, Acting Director of the Federal Bankruptcy Agency’s local branch, said Tolstoshein can only offer suggestions, “but beyond that he doesn’t have any rights.”