Reitmans (Canada) Limited (TSX:RET.A)

Reitmans (Canada) Limited (TSX:RET.A), Canada's largest women's apparel retailer and the main operating entity of the Reitmans Group, obtained protection under the CCAA on May 19. Founded in 1926 in Montreal, Quebec, the company now operates 576 stores across Canada, including Reitmans outlets, Penningtons, RW & CO. stores, Addition Elle stores and Thyme Maternity locations. For the past three years, the Reitmans Group has seen a significant decrease in sales and, in its last fiscal year, it incurred a net loss of $87 million. Although the company had started to reduce its number of brick-and-mortar stores prior to COVID-19, the pandemic further caused a sharp decrease in sales when the remaining stores were temporarily closed in March. Given that e-commerce sales represent less than 30% of total sales, the impact of COVID-19 has been significant and the company expects to run out of liquidity shortly. The company, which currently has $361.0 million worth of assets, owes its creditors approximately $109.0 million, including $24.0 million in pension plan obligations as well as unpaid rent owed to its landlords. In consultation with the court-appointed monitor, EY, the company intends to conduct a sale of retail inventory located in certain stores. Counsel is Davies for the company and Osler for EY.