January 9, 2020
Sle-Co Plastics, a St. Thomas, Ontario-based Tier 2 automotive parts supplier operating from real property in St. Thomas, was placed in receivership on January 9 on the motion of RBC, owed CAD $5.6 million and USD $2.3 million. Sle-Co Properties, which owns the St. Thomas property, owes RBC $3.5 million. During 2018, the company consolidated three production locations in London, Ontario into the one St. Thomas property. Cost overruns in preparing this new facility, re-location costs, operational issues on start-up, and the conclusion of a major contract all negatively impacted the company's financial position. In September 2019, Sle-Co Properties entered into an agreement of purchase and sale for the sale of the St. Thomas property to a third party, to be leased back to the company on certain conditions. The agreement eventually lapsed and the two companies were unable to obtain re-financing. On November 5, the company filed an NOI and BDO was appointed proposal trustee. The companies attempted to restructure their affairs through the sale of all or a portion of their assets, including the St. Thomas property. Based on the outcome of this sales process, the company determined it would not be able to file a viable proposal. Accordingly, the company will be deemed bankrupt after January 18, and a receiver will be required to complete the sales process initiated by the company. BDO was appointed receiver. Counsel is Harrison Pensa for RBC, Advocates for the companies, and Aird & Berlis for the receiver.