Carey Management Inc. (“CMI”), Wallace & Carey Inc. (“Wallace & Carey”) and Loudon Bros Limited (“LBL”, and together with CMI and Wallace & Carey, the “Applicants”) operated a family-owned business that was founded in 1921 and filed for protection under the Companies’ Creditor Arrangement Act (the “CCAA”) in June 2023. KSV is the court-appointed monitor (the “Monitor”) in the CCAA proceedings.
Wallace & Carey and LBL operated the Applicants’ logistics business (the “Logistics Business”). The Logistics Business supplied and distributed more than 7,500 different products to approximately 7,000 customer locations across Canada. At the date the CCAA proceedings commenced, the Logistics Business was one of Canada’s largest independent wholesale distribution and logistics operations. With revenue exceeding $1 billion, Wallace & Carey’s notable customers included 7-Eleven, Cineplex, Landmark Cinemas, Fresh Slice Pizza, and Federated Co-op.
The Applicants’ financial difficulties commenced during the COVID-19 pandemic, which created various operational challenges, resulting in significant losses and liquidity pressures.
Under KSV’s supervision, a sale and investment solicitation process was carried out during the CCAA proceedings that resulted in a going-concern transaction for Wallace & Carey’s business that preserved employment for most of Wallace & Carey’s employees and repaid in full the amounts owing to Applicants’ secured lenders, Canadian Imperial Bank of Commerce and Canadian Western Bank, as well as other stakeholders. As part of the transaction, the Alberta Court of King's Bench approved a transition services agreement (the “TSA”) among CMI, Wallace & Carey, 7-Eleven and the Monitor and appointed KSV as Receiver over certain subsidiaries of CMI. Since that time, KSV, as Monitor, has worked extensively with the Companies to administer the TSA and, as Monitor and Receiver, to realize on various assets not included in the transaction with 7-Eleven, including excluded inventory, accounts receivable, vendors credits, real estate, and CMI’s equity interests in its subsidiaries.
As of June 1, 2024, these proceedings were ongoing.