Heavy North Construction, an Edmonton, Alberta-based civil construction company, was placed in receivership on April 16 on application by 1056420 Alberta Ltd., owed approximately $2.4MM. KPMG was appointed receiver. Counsel is Bennett Jones for the applicant, Blakes for ATB and Osler for the receiver.
Patriot Equipment, a Medicine Hat, Alberta-based oil and gas field services supplier, was placed in receivership on April 11 on application by RBC, owed approximately $892.4M. In or about late 2018 and early 2019, RBC discovered that Patriot had failed to disclose its liability for an oil spill on a third party's property, as well as committing several other acts of default. The receivership application was adjourned in early March to permit Patriot time to payout the RBC indebtedness, however proposed financing fell through and the amount was not repaid. KPMG was appointed receiver. Counsel is Osler for the applicant and BDP for the receiver.
Strategic Oil & Gas (TSX-V: SOG), a Calgary, Alberta-based junior oil and gas company, along with its wholly owned subsidiary, Strategic Transmission, obtained protection under the CCAA on April 10. Focused primarily on oil and gas development in Northern Alberta, the company cites several key factors that have led to its current financial position, including deteriorating differentials on Canadian oil prices and political uncertainty with respect to pipeline approvals at the Federal level. In June, 2018, the company entered into a transaction to sell certain of its assets. Despite the sale closing, however, the proposed purchaser was unable to meet the Liability Management Ratio requirements of the Alberta Energy Regulator to facilitate the necessary license transfers. As a result, Strategic was forced to unwind the transaction, further weakening its financial position. With no capital available to fund further development and drilling improvements, the company will look to complete a sale and investment solicitation process while under creditor protection. KPMG was appointed monitor. Counsel is Dentons for the applicant and Torys for the monitor.
Devlin Construction, an Alberta, Edmonton-based construction company, was placed in receivership on April 9 on application by ATB, owed approximately $5.6MM. The company ran into financial difficulties with the downturn of the oil and gas industry as the number of jobs and margins on those jobs decreased. In February, the company filed an NOI in an attempt to restructure its affairs, seeking primarily to sell redundant assets and obtain interim financing. The company's request for a second extension of time to file a proposal was not supported by ATB or the Bowra Group, its proposal trustee, who reported that efforts to formulate a proposal were not progressing in an efficient and timely manner primarily because of the company's directors lack of cooperation and inability to work together. The court did not grant the extension and subsequently appointed PwC as receiver of the company. Counsel is Blakes for ATB and Emery Jamieson for the company.
Innova Global, a Calgary, Alberta-based provider of noise control and waste recovery system solutions for industrial sites worldwide, was placed in receivership on April 1 on application by ATB, owed together with a syndicate of other lenders approximately $74.2MM. In February 2019, the company advised ATB that it anticipated defaulting on its credit agreement because it was unable to make a required repayment of $2.5MM due on February 29. Despite several extensions and extensive negotiations, the parties have been unable to find a collaborative solution to address the liquidity challenges. When TriWest Capital Partners, the company's indirect private equity sponsor, advised in March that it was unwilling to either invest capital into the business or purchase all or a portion of the lenders' security, ATB demanded repayment of the debt. PwC was appointed receiver. Counsel is McCarthy Tétrault for the applicant and Stikeman Elliott for the company.
Schendel Mechanical Contracting, an Edmonton, Alberta-based mechanical contractor, filed an NOI on March 22, listing $37.2MM in liabilities, including $18.1MM to ATB. The company has accused the provincial government of owing them $26.0MM for work done on the Grande Prairie Regional Hospital, a $760.0MM project that Schendel has been working on for almost 6 years and that has been plagued with problems. Grant Thornton is the proposal trustee.
Genco Holdings, a Calgary, Alberta-based developer of commercial and retail property that owns two properties collectively known as the "160 Acre Lands", a property known as the "634 Lands", and 12 separate condominium plan descriptions, had certain of its property placed in receivership on March 22 on application by HSBC, owed approximately $8.6MM. In light of various breaches and defaults committed by the company, HSBC has significant concerns regarding its ability to continue operating as a going concern. The application as it relates to 160 Acres Lands is adjourned by consent until next week with a view to reaching a deal. EY was appointed receiver. Counsel is Torys for the applicant and Fasken for EY.
Kel's Electrical Contracting, an Edmonton, Alberta-based full-service electrical company, filed for bankruptcy on March 21, listing approximately $663.3MM in liabilities, including $244.0M to Eecol Electric. Bowra Group is the bankruptcy trustee.
Surface Pro Surfaces, a Calgary, Alberta-based landscape contractor, as well as two related companies, were placed in receivership on March 19 on application by RBC, owed approximately $3.3MM. Since early March, the companies have been unable to fund their payroll obligations. In the same month, RBC discovered that Atkins, one of the companies' directors, attempted to deposit personal cheques totaling $50.0M into Surface Pro Surfaces' bank account drawn from the RBC account of his deceased father. The cheques were returned because RBC had no record of Atkins having any executorship or authority over this account. It was also discovered that an employee had attempted to negotiate cheques payable to Surface Pro Surfaces in the accounts of other related companies over which RBC does not have security. The companies have also not been forthcoming with RBC about the status of any priority obligations owing to CRA. Deloitte was appointed receiver. Counsel is BLG for the applicant and Torys for the receiver.
Westpoint Capital, an Edmonton, Alberta-based investment fund manager that manages a portfolio of Canadian real estate, was placed in interim receivership on March 13 on application by Westpoint Investment Trust by its Trustees, Munir Virani and Marnie Kiel. BDO was appointed interim receiver. Counsel is DLA Piper for the applicant and Miller Thomson for the interim receiver.