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Asahi and the Mayo venture

County View

County View
John Healy

Twenty years ago this month, the sale of the vacant Asahi plant in Killala to a US consortium brought the final curtain down on a venture that had promised so much but that ended in failure.
The announcement in 1975 by the Japanese corporate giant that it was to set up a synthetic-fibre plant in Killala was the stuff of dreams for the country, for north Mayo in particular, and for the IDA.
The proposal was welcomed with open arms, and everything was done to smooth the path. A 400-acre site for the plant was secured; Mayo County Council rushed through a € 1.6 million water-supply scheme to provide the plant with the 20 million gallons of water it needed per day; and efforts to recruit 500 workers, most of them from the area, swung into action.
By 1977, Asahi was in full production, its plant working around the clock, seven days a week. The spinoff for the community was massive, with over € 10 million a year being pumped into the local economy. The Asahi chemical trains trundled across the country to Ballina station, further enhancing the level of economic activity.
But all was far from perfect in terms of company viability. Rival synthetic manufacturing plants were opening across Europe; the market for fibre was weakening; prices were falling.
The first dark clouds were appearing in 1981, when, admitting to accumulated losses of several million, Asahi undertook a capital restructuring of its Killala operation. The Japanese, however, insisted that they were committed to Mayo, that the company had deep financial resources and that the tide would turn.
But then, in 1995, came Asahi’s hammer-blow decision to pull out of the Irish operation. There was no long-term future for Killala. It transpired that the plant had racked up losses of over €50 million since its opening two decades earlier.
Asahi, in truth, had been in trouble from the very start.
Now it became a matter of the orderly wind-down of the Japanese involvement in Killala. Negotiations commenced whereby Asahi would relinquish the Irish operation by way of a management buy-out. The company offered a €17 million investment package for such a buy-out, to be augmented by IDA funding, with a guarantee that 300 of the 315 jobs at the plant would be retained.
The plan depended on employee approval, and the key moment came in July 1977, when the new structure was presented to the workforce to be voted on. SIPTU recommended acceptance of the proposals, albeit with a certain reluctance in that earnings would be reduced and established work practices changed. Some saw the development as merely a stay of execution – after all, if the Japanese could not make the operation viable, what confidence could there be that a new management could do any better?.
In the crucial vote, all 46 administrative and clerical staff voted for acceptance. Of the company’s operatives, 93 voted for and 126 voted against. Since it had been a condition of the proposal that a majority of the operatives was required, the proposal was deemed to have been rejected.
It was the end of the road for Asahi. The Japanese management accepted that the vote was final; there would be no more negotiation, no second chance for a change of mind. As a farewell gesture to the local community, Asahi donated €200,000 to a North Mayo Enterprise Fund to encourage job creation and local enterprise.
Behind them they left a devastated community, a stunned workforce, and a silent, sprawling, empty industrial site to serve as a reminder of what had been a time of hope and prosperity.

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