TORONTO — Sears Canada has been granted bankruptcy protection by the Ontario Supreme Court under the Companies’ Creditors Arrangement Act. Among other things, the Initial Order provides for a stay of proceedings in favour of the Sears Canada Group for an initial period of 30 days, subject to extension thereafter as the Court deems appropriate, and the appointment of FTI Consulting Canada Inc. as monitor in the CCAA proceedings.
The Initial Order also authorizes the Sears Canada Group to obtain debtor-in-possession financing of $450 million to provide the retailer with sufficient liquidity to maintain business operations throughout the CCAA proceedings.
The announcement comes as the giant retailer’s shares continued their freefall this week, falling by more than 20% on Wednesday amid a report by Bloomberg of the company’s pending filing. Sears Canada “will work to complete its restructuring in a timely fashion and hopes to exit CCAA protection as soon as possible in 2017, better positioned to capitalize on the opportunities that exist in the Canadian retail marketplace.”
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