Pride Group Holdings Inc. et al., CCAA

Pride Group Holdings Inc. et al., a Mississauga, Ontario-based cross-border trucking and logistics conglomerate, obtained CCAA protection on March 27, listing liabilities and performance obligations of approximately $1.6 billion to its more than twenty lenders.

The Pride Group is one of the largest trucking carriers in Canada, operating from more than fifty leased and owned facilities across Canada and the US.

The companies have been facing financial difficulties since the COVID-19 pandemic, including due to a post-pandemic increase in trucking and logistics supply, which led to a simultaneous reduction in pricing and increase in costs.

By December 2023, many of the Pride Group’s lenders had cut off availability under their facilities, impacting the group’s ability to fund new inventory and lease sales and ultimately its liquidity.

The Pride Group engaged EY as its financial advisor and RC Benson Consulting as CRO to assist with their financial issues and to attempt to negotiate forbearance arrangements with their lenders. Despite good faith efforts, a deal was not reached.

In January 2024, the Pride Group ceased paying their obligations under various facilities, causing many lenders to demand payment.

In the week preceding the filing, lender Mitsubishi HC Capital reportedly filed a claim against the Pride Group’s president and CEO Sulakhan “Sam” Johal and vice-president Jasvir Johal seeking damages of approximately US$100 million in connection with their personal guarantees.

The Pride Group has also sought recognition of the CCAA proceedings under Chapter 15 of the US Bankruptcy Code.

EY is the monitor and RC Benson Consulting is the CRO. FTI is Mitsubishi’s financial advisor.

Counsel is TGF for the Pride Group; Blakes for the monitor; Bennett Jones for the directors and officers; Dentons for HSBC Bank, BMO and Daimler Truck Financial Services Canada; McMillan for BNS and Roynat; Fasken and Osler for RBC; Chaitons and Osler for Mitsubishi; Pallett Valo for Meridian OneCap; Stikeman Elliott for BNY Trust Company; and McCarthys for National Bank of Canada; and Gowling for VFS Canada.