Bentley Leathers

Bentley Leathers, a Montreal, Quebec-based retailer of luggage, handbags and travel accessories, filed an NOI on November 26. Attributing its financial difficulties to changing consumer behavior and the impact of digital disruptions, the company plans to close 100 of its 250 stores across Canada through the proposal proceedings. KPMG is the proposal trustee. Hilco has been retained to liquidate the closing stores. Counsel is Davies for the company, McCarthy Tétrault for the proposal trustee, Osler for Hilco and Miller Thomson for CIBC, the company's senior lender owed approximately $18.0 million.


Bouclair, a Montreal, Quebec-based retailer of home fashion and decor products, filed an NOI on November 11. Founded in 1970, the company has grown to 92 locations across Canada and employs approximately 1,150 employees. It also sells online and through a wholesale business that operates internationally. Over the past few years, the company has struggled amidst increased competition from large-scale discount US retailers such as Walmart, and online retailers such as Amazon and Wayfair. Internally, the company has also faced issues. A new warehouse management system system led to operational difficulties, and various locations significantly underperformed as a result of high rents, the increase in minimum wage, and the company's inability to recruit strong talent to manage the stores. Cost-cutting measures have not returned the company to profitability. Through the proposal proceedings, the company will look to complete a transaction that will see a significant portion of the company's assets sold to a new investor group led by the company's current president. It is anticipated that 29 stores will be closed and liquidated as part of the restructuring. Deloitte is the proposal trustee. Richter is financial advisor to National Bank, the company's senior lender owed approximately $18.8 million. EY conducted the company's pre-filing SISP. Gordon Brothers is conducting the liquidation. RC Benson is CRO. Counsel is Stikeman Elliott for the company, Osler for the proposal trustee, Fasken for Gordon Brothers, McCarthy for National Bank and Davies for certain other subordinated lenders.

Forever XXI ULC

Forever XXI ULC, the Canadian operating subsidiary of US-based retailer Forever 21, obtained protection under the CCAA on September 29. The filing occurred on the same day the company's parent filed for Chapter 11 bankruptcy protection in the US. In Canada, the company operates 44 retail stores in malls across the country, selling apparel, accessories and other products under the Forever 21 and other related brands. While the company's initial expansion into the Canadian market in 2001 was promising, it has struggled to maintain profitability, and the vast majority of its stores are unprofitable. As part of its global restructuring plan, Forever 21 has determined that it will exit substantially all of its international markets, including Canada. Following a pre-filing bid solicitation process, the company selected Gordon Brothers and Merchant Retail Solutions to jointly conduct an orderly liquidation of the Canadian inventory and other assets. PwC was appointed monitor. Alvarez & Marsal is the company's financial advisor. Counsel is Osler for the company, Goodmans for the monitor, Norton Rose Fulbright for lender J.P. Morgan Chase, Cassels Brock for Gordon Brothers, Torys for Cadillac Fairview and Gardiner Roberts for Oxford Properties.

Black Angus Group

Black Angus Group, a Thornbury, Ontario-based group of companies operating a butcher shop business, was placed in receivership on September 18 on application by Laurentian Bank, owed approximately $1.2 million. Founded in 2005, the company operated online and through three retail locations, selling traditional wild game meats such as boar, bison and venison, as well as more unique meats such as kangaroo and crocodile. Operating under a forbearance agreement since August 2018, the company was unable to refinance its debt and, in recent months, made minimal deposits to its Laurentian bank accounts, leading Laurentian to believe that the company was depositing its accounts receivable with another financial institution. RSM was appointed receiver. Counsel is TGF for the applicant.

Davids Footwear

Davids Footwear, a Toronto, Ontario-based luxury women’s shoe retailer, was placed in receivership on August 2 on application by Rosejack Investments, owed approximately $9.0 million. With a history dating back to 1954, the company has historically been profitable but, like many other footwear retailers, it has faced challenges in recent years. Rosejack, a company affiliated with menswear retailer, Harry Rosen, acquired the company in 2017 with plans to add stores across the country. The expansion never took place though, and the company's most recent financial statements indicated a loss of almost $1.0 million. The company attempted to seek rent concessions from the landlords of its Mink Mile and Sherway Gardens locations but was not successful. Additionally, the company recently learned that it would be losing one of its key brands, Valentino, as the footwear supplier has plans to expand its own stores in the company's territory. With all forecasts indicating further losses for a number of years that would require additional cash injections, Rosejack made the decision to seek the appointment of a receiver to effectuate an orderly wind down of the business. Richter was appointed receiver. Counsel is BLG for the applicant and Fasken for the receiver.

Miniso Canada

Miniso Canada, the Canadian-based retailer of Miniso, a global retail brand ("Miniso Global"), obtained protection under the CCAA on July 11. Launched in 2017, the Canadian company has grown to 67 stores across the country, operating under a license agreement with Miniso Global. A dispute arose in the fall of 2018 over the quantum of debt owed to Miniso Global which led to Miniso Global demanding repayment and filing a bankruptcy application against its Canadian partner. A forbearance agreement was ultimately reached in January 2019 between the parties that required Miniso Canada to, among other things, enter into good faith negotiations for the sale of the Canadian operations to Miniso Global. A transaction never transpired, and when the forbearance agreement expired on June 25, repayment was again demanded. Rather than appointing a receiver, Miniso Global elected to make an application for CCAA protection for the Canadian company so as to maintain enterprise value. Alvarez & Marsal was appointed monitor and has been given enhanced powers to manage the Canadian operations during the proceedings while a restructuring transaction is pursued. Counsel is Fasken for Miniso Global, McMillan for Miniso Canada and Dentons for the monitor.

Solo Liquor Stores

Solo Liquor Stores, a Calgary, Alberta-based liquor retailer, was placed in receivership on May 1 on application by ATB Financial, owed approximately $29.5MM. Founded in 1996, the company has grown to become the largest private liquor retailer in Alberta with over 40 locations across the province. The company has been experiencing significant cash flow issues for a number of months and was in default on its loans to both ATB and Crown Capital. Pursuant to a forbearance agreement with ATB, the company engaged Eight Capital to run a sales process for the business but no transaction was completed. Anticipating a shortfall on its loan, ATB decided that the appointment of a receiver would be the most efficient and cost-effective manner to maximize recoveries. FTI was appointed receiver. Counsel is Blakes for the applicant, McCarthy Tétrault for the company, Torys for the receiver and MLT Aikins for Crown Capital.

9449167 Canada Inc.

9449167 Canada Inc., operating as a Shell gas station in Cornwall, Ontario, was placed into receivership on March 29 on application by BDC. MNP was appointed receiver. Soloway Wright is counsel for the applicant.

Green Earth Stores and Green Earth Environmental Products

Green Earth Stores and Green Earth Environmental Products, a Canadian specialty retailer of giftware, jewellery, collectibles and environmentally friendly products, which operates 29 stores across Canada, filed an NOI on March 4. As a result of the financial difficulties suffered due to reduced mall traffic and increased online competition, the London, Ontario-based Green Earth entities made the decision to conduct a store closing process commencing on March 8. On March 7, the Green Earth entities obtained court approval of, among other things, a Liquidation Process Order. The company has engaged FAAN Advisors Group as their chief restructuring advisor to assist with the NOI and store closure process. Crowe Soberman is the proposal trustee. Counsel is Miller Thompson for the company and Stikeman Elliott for the proposal trustee.

Payless ShoeSource Canada

Payless ShoeSource Canada, the Canadian subsidiary of the American discount footwear retailer, which operates 248 stores across Canada, obtained protection under the CCAA on February 19. The Payless Canada entities owe approximately $156.7MM (USD) under an ABL Credit Facility to which they are guarantors. Coinciding with the commencement of the CCAA proceedings in Canada, certain affiliates of the company filed for Chapter 11 bankruptcy protection in the US. Payless Holdings and other subsidiaries (the "Payless Group") had previously filed for Chapter 11 bankruptcy in 2017. The Payless Group also applied to the Ontario Superior Court of Justice as the foreign representative. Both the Canadian court and the US Bankruptcy Court approved a reorganization, which was effective as of August 2017. Despite these proceedings, the Payless Group has been unable to sustain profitable operations in the current retail environment. Although the Group sought to deleverage their balance sheet and implement cost-reduction by downsizing their corporate offices, terminating various employees and reducing their capital expenditures plan, its North American brick and mortar business continues to experience top-line sales decline. Despite efforts to negotiate with Payless Group's pre-petition lenders for additional credit, the Payless Canada entities have been unable to return to profitability, reporting a net operating loss of more than $12.0MM (USD) in 2018. As a result of the financial difficulties suffered, the Payless Canada entities are insolvent and unable to meet their liabilities as they become due. Since January 2019, Ankura Consulting Group, a consulting and financial advisory firm, has been engaged to act as Chief Restructuring Organization ("CRO") and provide advisory services to the US debtors, including the Payless Canada entities. The Payless Canada entities, which intend to seek court approval of a liquidation approval order, have also engaged Malfitano Advisors to assist as an asset disposition advisor. Together, they conducted a solicitation and bidding process for a liquidator which ultimately led to the selection of Great American and Tiger Capital Group as joint liquidators. Many of the Canadian stores will begin closing at the end of March. FTI Consulting was appointed monitor. Canadian counsel is Cassels Brock for the Payless Canada entities, Bennett Jones for the monitor, Norton Rose Fulbright for the ABL Agent, Wells Fargo Bank, Fasken for an ad hoc group of lenders and Stikeman Elliott for the liquidators.

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