Expressing displeasure with the High Court decision favoring the lenders of the real estate giant, the management of Group Selection announced on Monday evening that they will appeal against the court’s verdict.
“Group selection conflicts with many of the points of law laid out in the ruling’s conclusions against effective financial restructuring […] “, the company’s President and Chief Executive Officer Real Boecklin announced via press release.
Quebec’s largest owner and operator of private seniors’ residences (RPA) is now seeking permission to appeal the ruling and plans to request a “stay” at the same time. shall be executed before the conclusion of legal proceedings.
A few hours earlier, the court ruled in favor of Group Selection’s creditors and handed over the recovery proceedings to PricewaterhouseCoopers (PwC) teams.
In an expected decision, after four days of hearings last week, Judge Michel A. Pinsonault on Monday rejected the company’s recovery plan and fully approved the request submitted by the National Bank of Canada on behalf of eight financial institutions.
There are debts of more than one and a half million
It will be remembered that the selection was placed under the protection of the CCAA on November 14, struggling with serious financial problems.
These loans to the banking syndicate amount to $272 million. To these, according to Selection Group, will be added at least $995 million owed to its employees, suppliers and other mortgage lenders.
Lack of transparency
On the brink of bankruptcy, the company, which has a particularly complex structure – involving no fewer than 137 related companies – has suggested handing over orders for restructuring procedures to a duo made up of FTI Consulting as controller and businessman Herbert Black. , as an interim financier.
For its part, a group of lending institutions provided PwC services.
For reasons detailed in a 25-page ruling, including management’s lack of transparency and the loss of trust in him by many shareholders, Judge Pinsonault ultimately chose the recovery plan he submitted.
The economic situation is very worrying
- 56% of its habitats would be lost.
- Average Occupancy Rate: 80%
Some known credits:
- $272.2 million to a banking syndicate
- $925 million to mortgage lenders
- $63.5M to $118M for various suppliers
- $6.8 million (holiday pay) to its employees
Legal mortgages in spades
In a sign of concern, thirty legal mortgages were registered on real estate projects undertaken by Selection Group in the last week alone. News magazine.
These mortgages, for a total of $6.65 million, were registered by more than twenty companies in the construction sector, currently working on five Group Selection real estate projects.
The legal hypothesis allows contractors involved in the construction or renovation of a building to defend amounts owed to them for work undertaken. Generally, such a mortgage has priority over conventional mortgages even if they are published earlier.
Five target projects
Five specific group selection projects were targeted by founders last week. We are talking about the Loquia Saint-Sacrément in Quebec, the Selection Retreat Repentigny, the Liwa Complex in Mirabel, the District Union Complex in Lachenai (Terrebonne), and the Veritage Lachine (or 2100 Remembrance) in Montreal.
The two biggest legal hypotheses concern formwork. One of them is listed by Coffrage Forma+ for $1.2 million worth of work in Mirabel. The second was recorded by Coffreges Atlantic for $881,902 in penitence work.
Coincidentally, the new Liva complex in Mirabel, which started work in the summer, was the project with the highest number of legal mortgage registrations for one week. The seven registered mortgages total not less than $2.46 million.
Loquia Saint-Sacrement in Quebec received ten new legal hypotheses for a total of $2.13 million. Finally, Selection Retreat Repentigny filed eight new legal hypotheses on its building valued at $1.64 million.
– With a contribution from Philippe Langlois from the Bureau of Investigation