2744364 Ontario Limited (o/a True North Cannabis Co.), 2668905 Ontario Limited (o/a Bamboo Blaze) and 2767888 Ontario Inc., CCAA

2744364 Ontario Limited (o/a True North Cannabis Co.), 2668905 Ontario Limited (o/a Bamboo Blaze) and 2767888 Ontario Inc., a group of Ontario-based cannabis companies with 285 employees, obtained CCAA protection on January 24 on application by The Vancor Group Inc., owed approximately $23 million on an unsecured basis.

True North Cannabis owns and operates 48 retail cannabis dispensaries in Ontario, as well as an online storefront for direct-to-consumer cannabis sales and deliveries in Ontario. Bamboo Blaze supplies PPE and cannabis accessories to cannabis retailers, while 2767888 Ontario Inc. owns 41 properties and is the landlord to True North Cannabis under most of its commercial leases.

Vancor sought to place the companies under CCAA protection because they are facing the impending maturity of approximately $7.5 million in secured debt owed to Firm Capital, which holds mortgages over 26 of the companies’ real properties. 

Vancor has lost confidence in the ability of the companies to make strategic business decisions, including with respect to the impending maturity of the Firm Capital mortgages, due to ongoing disputes between the companies’ ultimate shareholders, Corry Van Iersel and Kenneth Schaller. Mr. Van Iersel and Mr. Schaller had been business partners in a number of ventures (including other cannabis companies) for a period of 10 years, until Mr. Van Iersel discovered various business decisions made by Mr. Schaller which led to the commencement of oppression remedy litigation, resulting in Mr. Van Iersel being granted sole authority over the companies.

This is the second creditor-led CCAA proceeding brought by Vancor arising out of these factual circumstances. In August 2024, it obtained a CCAA initial order for Galaxie Brands Corporation and 1000370759 Ontario Inc., which emerged from CCAA protection in late 2024.

The purpose of the CCAA proceedings is to conduct a SISP under the supervision of Deloitte as monitor and Shawn Dym, the court-appointed CRO.

Counsel is Miller Thomson for The Vancor Group, Blaney McMurtry for the monitor, BLG for the companies, TGF for Firm Capital, MPG for Kenneth Schaller, and Perley-Robertson, Hill & McDougall for Garas Family Holdings.