Crown Crest Leasing Business Undergoes Financial Restructuring to Improve Financial Position amidst a Significant Rising Interest Rate Environment
- Proceedings have been initiated to commence a Court-supervised process to ensure the company's stability, that the business continues critical services to customers, and to protect the interests of all stakeholders
- Crown Crest Leasing Group will receives a commitment for $15 Million in new financing to support business operations during the process
- This process will have no impact on the operations and services provided to the customers we serve
TORONTO, Nov. 9, 2023 /CNW/ - Proceedings were commenced today in respect of Crown Crest Capital Management Corp. and certain of its affiliates (the "Company") under the Companies' Creditors Arrangement Act (CCAA). This is a court-supervised process that will allow for a financial and operational restructuring of the Company. This process is not a bankruptcy or liquidation of the Company. On the contrary, the CCAA process will provide the Company with time and flexibility to continue ongoing discussions with its financial stakeholders in an effort to achieve a path forward that strengthens our financial position amidst a rising interest rate environment that has created financial challenges for the Company.
"After successfully navigating the COVID-19 pandemic and the global supply chain crisis, tightening our operating costs and working closely with our lending partner, we continue to face additional global macroeconomic and geopolitical challenges that have affected our business. In particular, inflation and significantly higher interest rates have made servicing our debt unsustainable, as our current interest obligations outweigh the fixed payment stream our customers pay us. " said Lawrence Krimker, founder of the Company.
In connection with the CCAA proceedings, the Company has appointed a chief restructuring officer (CRO) and KPMG Inc. has been appointed as the Monitor in the Company's CCAA proceedings. The CRO and Monitor will assist the Company to explore restructuring options available to it under the CCAA. This restructuring process is aimed at ensuring the Crown Crest Leasing Group's business's stability, allowing the company to continue critical services to customers and to protect the interests of all stakeholders involved.
Further, the Company has received a commitment for $15 million in new debtor-in-possession financing from its existing lender. Following Court approval, this new financing, combined with cash generated from the Company's ongoing operations, is expected to support the business during the Court-supervised process.
It is the goal of the Crown Crest Leasing Group and everyone else involved to ensure that this process has no impact on the operations and services provided to the customers we serve. We understand that it is essential to the thousands of customers using Crown Crest Leasing Group's equipment in their homes that the business be preserved and stable, since this will allow continued repair and servicing of furnaces and water heaters as winter approaches.
"As we move through this process, we remain focused on ensuring there is no disruption to the high level of service provided to our customers across Canada, and we are grateful for their trust in us. We thank our dedicated employees for their ongoing hard work and excellence, and we also extend our gratitude to our trusted partners, suppliers and vendors for their continued support," said Mr. Krimker.
Additional information regarding the Company's CCAA proceedings is available on the Monitor's website at kpmg.com/ca/crowncrest. The Monitor will be sending a notification to all known creditors, including employees, with additional information about these CCAA proceedings in the coming days.
SOURCE Crown Crest Capital Management Corp.
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