On May 1, 2020, JMB Crushing Systems Inc. ("JMB") and its wholly owned subsidiary 2161889 Alberta Ltd. ("216") sought and obtained an initial order from the Court of the Queen's Bench of Alberta under the Companies' Creditors Arrangement Act R.S.C. 1985, c. C-36, as amended ("CCAA").
Almost one year later on April 27, 2021, JMB and 216 completed their restructuring.
Gowling WLG represented JMB and 216, Canadian Aggregate Resources Corporation ("CARC"), the immediate parent of JMB, and a private equity firm out of Denver, Colorado, Resource Land Holdings ("RLH"), the ultimate parent of these entities.
JMB and 216 owned and operated over 50 gravel and aggregate pits in Alberta. The companies suffered severe and sustained cash flow shortfalls as a result of the downturn in the oil and gas industry, the retreat of foreign and domestic capital investment from that sector, and the impact of the emergency measures taken in response to the COVID 19 pandemic.
The restructuring was implemented through:
the creation of Mantle Materials Group, Ltd. ("Mantle"), which purchased the business and certain assets of JMB and 216;
a reverse vesting order, pursuant to which the assets and liabilities of JMB and 216 that were excluded from the transaction were vested in a newly created numbered company;
a plan of arrangement under the CCAA and British Columbia Business Corporations Act, pursuant to which (i) the shares of the minority shareholder in JMB were cancelled for no consideration, (ii) the shares of CARC in JMB were transferred to RLF Canada Holdings Ltd., a newly created holding corporation for RLH's Canadian aggregate investments, and (iii) a portion of the indebtedness of JMB and 216 to ATB Financial ("ATB") and Fiera Capital ("Fiera") was assumed by Mantle and retained by JMB and 216; and
an environmental reclamation trust funded by Mantle, ATB and Fiera to provide for the reclamation of gravel and aggregate pits of JMB and 216 that are to be retired.
The Gowling WLG team was led by Tom Cumming and included Caireen E. Hanert, Stephen Kroeger and Jonathan Ross, supported by Alyssa Elms and Kristy DeIure (restructuring and insolvency); Zafar Jaffer, Simanpreet Panaych, Anita Yuk, Jill Dunn, Rachel Venables, Sylvia Poiet and Stephanie McCallum, supported by Reena Pulkinen (corporate finance); Alison Gray (commercial litigation and insurance); Stephen Carter-Edwards (builders' liens); Ted Thiessen and Michael Bussmann (tax); Beth Burton and Braden Sheps (financial services); and Will Cascadden (employment).