Westridge Cabinets, a Red Deer, Alberta-based cabinet manufacturer, was placed in receivership on August 16 on application by BMO, owed approximately $2.4 million. Attributing its financial difficulties to the consistent decline in housing starts in Alberta, the company filed an NOI on July 5 after its majority shareholder, Toronto-based Signal Hill Equity Partners, advised that it was no longer prepared to continue supporting the company's financial losses. While under creditor protection, the company began a wind-down of its operations. No proposal was filed by the company and on August 10 it was deemed bankrupt. BMO then moved for a receiver to be appointed to protect its interests. PwC was appointed receiver. Counsel is Dentons for the applicant, BLG for the receiver and TGF for Signal Hill.
Acier Orford, a Sherbrooke, Quebec-based company specializing in the manufacturing and installation of reinforcing steel and wire mesh, filed a proposal to its creditors on August 16. In March 2019, it was discovered that the company's accounts receivable included invoices for future work and extras on projects that had not yet been approved. It was also discovered that the company's inventory had been overstated. In May 2019, two of the company's senior lenders, BDC (owed $1.8 million) and TD (owed $9.8 million), issued demands for repayment. In response, the company has put together a restructuring plan that will see Groupe Dallaire, a supplier and major business partner, take over the company. The restructuring will see the company's secured lenders take a discount on their loans, and a basket payment of $200.0 thousand is being offered to the company's remaining unsecured creditors. PwC is the proposal trustee. Counsel is Serge Dubois for the company, McCarthy Tétrault for the proposal trustee, Fasken for TD, BLG for BDC and Langlois Avocats for Groupe Daillaire.
Plasticon Canada, a Montreal, Quebec-based manufacturer of fiberglass reinforced plastic products such as storage tanks and piping systems, filed for bankruptcy on July 29, listing $5.4MM in liabilities, including $2.0MM to HSBC.The company's recent financial difficulties are largely a result of a sizeable but ultimately unprofitable contract that the company entered into in 2018. The company was receiving financial support from its parent company in Europe, but due to continued losses and weak order intake over the last months it became impossible for the parent company to continue supporting its Canadian subsidiary. EY was appointed bankruptcy trustee.
Noreast Foods, a Scarborough, Ontario-based manufacturer of tofu and bean products, was placed in receivership on July 26 on application by TD, owed approximately $3.4MM. Packaging its products under brands such as Northeast, Guway, Sou Fresh and Sou Organic, the company claims to hold a significant market share of tofu sales in the Greater Toronto Area but has been experiencing financial difficulties recently. Albert Gelman Inc. was appointed receiver. Counsel is Blaney McMurtry for the applicant and Aird & Berlis for the receiver.
Holistic Blend, a Mississauga, Ontario-based manufacturer of natural organic pet food and pet health care products, was placed in receivership on June 12 on application by Bridging Income Fund, owed approximately $2.4MM. Despite routinely being unable to fund payroll, rent and production, the company maintained the support of Bridging for several years with promises of significant sales growth. Recently, however, it has become evident that this growth is not materializing, and the latest balance sheets and income statements show that the company is insolvent on a balance sheet and cash flow basis. On May 14, the company advised Bridging that it would stop selling pet food and focus on pet health supplements only. Having lost faith in the company's ability to manage its business, Bridging subsequently demanded repayment. BMO, owed $807.0M by the company, also did so shortly thereafter. KSV was appointed receiver. Counsel is Chaitons for the applicant, MacDonald Sager Manis for the company and Aird & Berlis for the receiver.
Hollander Sleep Products, a leading North American mattress and pillow manufacturer, obtained Canadian recognition of its US Chapter 11 proceedings on May 23. Based in Boca Raton, Florida, Hollander has 13 manufacturing facilities in the US and Canada and 2,370 employees across North America. It produces bedding products for well known license brands including Ralph Lauren, Simmons, Beautyrest, Nautica and Calvin Klein, in addition to manufacturing products under its own brands. Despite a healthy and growing sleep industry, the company cites several factors for its recent financial struggles, including a dramatic increase in the price of materials such as fiber, down and feathers and integration costs associated with the acquisition of a major competitor in June 2017. In Canada, the company maintains manufacturing facilities in Montreal, Quebec and in Toronto, Ontario, where it also has a sales office. KSV was appointed Information Officer. Canadian counsel is Osler for the applicant, Norton Rose for the Information Officer, Goodmans for the ABL lenders and Blakes for the term loan lenders.
Northfield Glass Group, a Moncton, New Brunswick-based manufacturer of insulated glass units that operated various divisions including City Thermo Pane and Economy Glass, had certain of its property and equipment placed in receivership on May 16 by way of a private appointment by BDC, owed approximately $1.2MM. Despite a $1.0MM investment from the provincial and federal governments in 2011 to modernize certain of its facilities, the group still suffered from inefficiencies in its operations and had not been profitable for the past few years. The group's main shareholder, Prelsecur, recently came to the conclusion that the operations of the group were no longer viable and decided to withdraw all financial support. The receivership is preceded by an assignment in bankruptcy that occurred on April 5. BDO is the receiver. EY is the bankruptcy trustee.
Mometal Structures, a Varennes, Quebec-based manufacturer and installer of non-conventional steel structures, was placed in receivership on May 8 on application by HSBC, owed approximately $7.8MM. In early April 2019, the company was placed in HSBC's loan management unit after a 13-week cash flow forecast indicated a $5.6MM deterioration in the company's margin position over a 10-week period. A revised forecast was provided by the company in April that showed no deterioration in the bank's position. This forecast, however, was predicated on the receipt of $11.0MM from EllisDon, the company's largest customer, as advances on future projects. By the end of April, these receipts did not materialize and the company did not have sufficient liquidity to continue operations. Deloitte was appointed receiver. Fasken is counsel for the applicant.
Topaz Cabinets, a Toronto, Ontario-based manufacturer of cabinets and countertops, filed for bankruptcy on May 1, listing $413.0M in liabilities. SLF is the bankruptcy trustee.
British Confectionery Company and British Baazar Company, a St. John's, Newfoundland and Labrador-based manufacturer of specialty paper, obtained protection under the CCAA on April 29. The company, which focuses on manufacturing break-open lottery and promotional products, had previously filed an NOI on November 5. Attributing its financial difficulties to a variety of factors including product recalls, a fire at its production facility, and lower margins on new contracts, the company was able to attract an investor during the proposal proceedings. The investor's offer contained several conditions though, including the requirement that the province participate in providing financing to the company. Though the province seemed willing, it indicated that as a result of the calling of a provincial election, there would be a moratorium on such decisions until after the new government is installed. The company therefore converted its proceedings from the BIA to the CCAA to allow additional time for the province and investor to consider the transaction. Deloitte is the monitor. BoyneClarke is counsel for the company.