KidKraft, Foreign Order Recognition

KidKraft, a US-based toy company, had its US Chapter 11 proceedings recognized in Canada on May 17.

Founded in 1968, the company is a leader in wood-based play products such as swing sets, dollhouses and playhouses. Its products are sold in large stores including Costco, Target and Walmart, as well as online.

The company is facing significant balance sheet and liquidity challenges caused by a range of factors that have resulted in the company’s operating margins being squeezed.

In early 2024, Gordon Brothers purchased the senior secured debt and provided additional financing to support the business while strategic alternatives were explored. A sales process has led to a proposed transaction with Backyard Products, LLC that will be completed while under creditor protection. Gordon Brothers, owed approximately USD $144.9 million, will provide DIP financing to support the restructuring.

KSV was appointed information officer.

Canadian counsel is Osler for the company, Gowling WLG for the information officer, Fasken for Gordon Brothers and McCarthy Tétrault for the purchaser.

By: Dina Milivojevic