Valeo Pharma Inc. (TSX:VPH) et al., CCAA

Valeo Pharma Inc. (TSX:VPH) et al., a group of Québec-based pharmaceutical companies, obtained CCAA protection on October 1.

The companies, which employ over 70 full-time staff, are focused on the commercialization of generic drugs and hospital products acquired or in-licensed from third parties in Canada.

Throughout its history, Valeo has financed its operations through more debt than equity, resulting in a highly leveraged balance sheet and high debt carrying costs. It currently has $95.2 million in liabilities, including US$24.5 million to secured lender Sagard Healthcare Partners and $24 million in unsecured debentures, $10.4 million of which is held by Investissement Québec.

In December 2023, Valeo undertook a strategic review process, but it did not result in a transaction that could be closed in time to meet the companies’ liquidity and working capital needs.

The purpose of the CCAA proceedings is to attempt to preseve the companies’ going concern value by relaunching a SISP. Sagard is providing a DIP loan. 

EY is the monitor.

Counsel is McMillan for Valeo, McCarthys for the monitor, Torys for Sagard and Kugler Kandestin for Accord Financial.