October 9, 2019

Filing Type:

Trustee: Grant Thornton

Applicant: RBC

Applicant Counsel: Aird & Berlis



NTG Clarity Networks (TSX-V:NCI), a Markham, Ontario-based telecommunications company, was placed in interim receivership on October 9 on application by RBC, owed approximately $7.8 million. NTG, along with a related Egyptian company, provide network, IT, and infrastructure support to telecommunication service providers in Egypt, Saudi Arabia and elsewhere in the Middle East. Due to constrained liquidity largely caused by NTG’s inability to sell new software technology on which it had spent approximately $5 million to develop, the company was transferred to RBC’s Special Loans Department in August, 2016 and has remained there ever since. In 2017, it was discovered that NTG had overstated its accounts receivable by counting certain work in progress as receivables, resulting in a $2.2 million over-advance. The over-margin position has recently increased to approximately $3.7 million and RBC has learned that, among other things, two major contracts had been cancelled and the corresponding receivables written off, and numerous customers were disputing invoices. RBC therefore moved for the immediate appointment of an interim receiver to oversee collections and secure receipts until the time that a receivership application can be heard. Grant Thornton was appointed interim receiver. Aird & Berlis is counsel for the applicant.