Harbour Grace Ocean Enterprises Ltd., a Harbour Grace, Newfoundland-based company which is one of the largest marine vessel repair, refit and construction businesses in Eastern Canada, and its parent company, Laurenceton Holdings Ltd., obtained CCAA protection on November 2.

The companies employ approximately 56 full-time employees and are one of the largest employers in the Harbour Grace area and in the Newfoundland and Labrador naval industry.

They have experienced liquidity issues as a result of several factors including a slow fishing industry, an unpredictable supply chain, the rising cost of supplies, significant unpaid accounts receivable, and fixed-price customer contracts which did not protect the companies from inflation or risk associated with delays in critical supplies.

The companies have no cash or access to further credit, such that they cannot make critical payments, including payments to suppliers and employees. They are also indebted to CRA on account of source deductions, which have been instead used to fund payroll and operating expenses.

PwC was appointed monitor.

Counsel is Reconstruct for the companies, Benson Buffett for the monitor, O’Keefe and Sullivan for Gray Enterprises, Cox & Palmer for BMO and Stewart McKelvey for BDC.

By: Dina Milivojevic