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.
Icon Stone & Tile, a Calgary, Alberta-based stone fabrication and installation business, filed for bankruptcy on September 3, listing approximately $2.8 million in liabilities, including $1.6 million to HSBC. Grant Thornton was appointed bankruptcy trustee.
Starmor Developments, a Calgary, Alberta-based real estate holdings company, filed for bankruptcy on August 26, listing $917.0 thousand in liabilities. Grant Thornton was appointed bankruptcy trustee.
R.D.E. Ventures, a Spruce Grove, Alberta-based equipment rental company, was placed in receivership on August 16 on application by National Bank, owed approximately $11.0 million. In March 2019, the then CFO of the company contacted National Bank requesting additional time to provide audited financial statements. By late April, the statements had not yet been provided, despite repeated assurances from the CFO that the statements were a day or two away from being delivered. In May, 2019, National Bank elevated the request for statements to the president of the company, who investigated and discovered that auditors had not even been hired. Concerned with this news, as well as the deteriorating financial position and defaults of the company, National Bank issued a demand for repayment on July 9, which triggered an NOI filing by the company. Further discoveries of funds being diverted to another financial institution, as well as a lack of a feasible restructuring proposal or plan, led National Bank to request that the proposal proceedings be terminated. FTI was appointed receiver. Counsel is McCarthy Tétrault for the applicant and Ogilvie for the company.
Machine Works Industrial, a Fort Saskatchewan, Alberta-based contractor specializing in welding and steel fabrication, was placed in receivership on August 13 on application by RBC, owed approximately $2.0 million. Deloitte was appointed receiver. Counsel is Burnet, Duckworth & Palmer for the applicant and Duncan Craig for the receiver.
Bearstone Environmental Solutions, a Calgary, Alberta-based oil and gas and environmental services company, was placed in receivership on August 6 on application by Nations Fund I, owed approximately $5.1 million. The depressed oil and gas prices experienced since 2014 have had a significantly negative effect on Bearstone's business, especially its fluid transportation business in Grande Prairie. Recently, the production curtailment program mandated by the Government of Alberta in November 2018 resulted in a drastic decline in activity, and in December 2018 the decision was made to cease operations at the Grande Prairie location. In consultation with its secured lender, Bearstone's parent company has structured a transaction to sell Bearstone's vacuum and water truck services businesses, as well as its environmental services business, to a related company. The transaction will be completed through the receivership. KPMG was appointed receiver. Counsel is Bennett Jones for the applicant, Osler for the company and Cassels Brock for the receiver.
Performance AG Group, a Calmar, Alberta-based supplier of crop input products, was adjudged bankrupt on August 1 on application by Farm Credit Canada. Pursuant to an agreement with FCC, customers could purchase their supplies from the company and have the amount owing added to their crop input loan with FCC. The company would then receive payment directly from FCC. Recently, FCC has learned that in several instances, customers have indicated that amounts were added to their loan for purchases they did not make or agree to. It appears that other customers have also been subject to the same issue with Scotia Bank and BMO. The Bowra Group was appointed bankruptcy trustee. Miller Thomson is counsel for the applicant.
DT Grain, a grain pooling company operating out of Okotoks, Alberta, filed for bankruptcy on July 24, listing $1.1MM in liabilities. The company sold grain to feedlots under contracts that included the delivery of the grain. When bidding on contracts, the company assumed it could backhaul from the drop-off locations to offset transportation costs. In reality, however, the company was unable to schedule the backhauls that it anticipated, leading to higher than expected costs and strains on cash flow. The Bowra Group was appointed bankruptcy trustee.
Schendel Mechanical Contracting, an Edmonton, Alberta-based mechanical contractor, was placed in receivership on July 19 on application by ATB Financial, owed approximately $18.1MM. One of Alberta's largest construction companies, the company had been successful for decades but hit a rough patch in late 2018 when work on one of its major projects, the Grande Prairie Regional Hospital, was halted by the Province of Alberta. The work stoppage affected Schendel's profitability, eventually causing it to default on amounts owing to ATB. In March 2019, ATB issued demand letters and notices of intention to enforce security. In response, the company filed an NOI and has been working hard to find a lifeline that would allow it to continue in business. On July 10, it filed a proposal to ATB and its other creditors. ATB immediately moved for an order deeming the proposal to be refused and an order appointing a receiver. ATB's position was that it had a veto over the proposal by the solo nature of its secured claim and it intended to vote against the proposal, based on a host of factors, including its perception that it would fare better in a bankruptcy or receivership than under the proposal. The orders were granted and PwC was appointed receiver. Counsel is McCarthy Tétrault for the applicant, Bennett Jones for the company, Miller Thomson for the receiver and MLT Aikins for the proposal trustee, Grant Thornton.
Ceana Sunridge, a Calgary, Alberta-based property developer, was placed in receivership on July 3 on application by Hillsboro Ventures, owed over $8.0MM. The company's principal business was the development of a 45,000 square foot, five building, retail condominium project in Northeast Calgary. Since approximately August, 2018, there has been no material progress on the project, as the company's lenders have refused to provide additional financing draws without equity injections that were previously agreed to. Alvarez & Marsal was appointed receiver and is tasked with overseeing the completion of the project. Counsel is Dentons for the applicant, Low, Glenn & Card for the company, Torys for the receiver and Burnett, Duckworth & Palmer for the first lien lender, ConnectFirst Credit Union.