In CCAA restructuring proceedings, the applicants sought court approval of a liquidation agreement to close and liquidate inventory at 62 underperforming retail store locations.
The liquidation process involved a competitive solicitation of liquidators, review of bids, and negotiation of an agency agreement providing a minimum guaranteed recovery and a distribution waterfall administered through a monitor-controlled trust account.
Secured creditors supported the proposed transaction and the monitor concluded the solicitation process was fair and produced the most favourable economic outcome.
Applying s. 36 of the Companies’ Creditors Arrangement Act, the court held that the disposition process was reasonable and that the consideration offered by the selected liquidator was superior to competing bids.
The court approved the liquidation agreement and related relief.
