June 29, 2020
Hillspring Farms Ltd. ("Hillspring"), HSF Foods Ltd. ("HSF"), and Hillspring Warehouse & Logistics Inc., New Brunswick-based companies engaged in grain brokerage services, a potato farming operation and a flake plant operation, filed for bankruptcy on June 26 and was placed in receivership on June 29 on application by Farm Credit Canada ("FCC"), owed approximately $70.7 million. In addition to the financing with FCC, the companies obtained financing from CIBC, owed approximately $21.2 million, BDC, and other secured creditors. Although the combined HSF and Hillspring revenues between 2016 and 2019 remained relatively stable, averaging $30.6 million per year, the combined debt levels increased from $43.1 million in 2016 to $107.0 million in 2019. After various meetings, the companies determined that a sale of their assets was the only solution to address their financial difficulties and the court has approved a sale agreement between the companies and McCain Produce. EY is the bankruptcy trustee and was appointed receiver. Counsel is McInnes Cooper for the companies, Cox & Palmer for FCC and Davies for the McCain Produce.