McMillan Advises The Bank of Nova Scotia in the CCAA Restructuring of North American Lamb Company

North American Lamb Company (“NALCO”), along with its six subsidiaries, filed for creditor protection under the Companies’ Creditors Arrangement Act (“CCAA”).

Formed as a result of the 2018 merger between Canada Gold Beef Ltd., owners of the Innisfail Alberta based SunGold Speciality Meats Ltd., the Canada Gold Lamb Lot near Iron Springs Alberta, and Fresh Canada Meats Ltd, the Canadian subsidiary of New Zealand’s Integrated Foods Ltd., NALCO has the capacity to annually process 80,000 animals. NALCO carried on business as a vertically integrated producer of sheep in Manitoba and Alberta. Their processing plant was the largest federally regulated processing facility in Canada, generating sales of lamb products to customers provincially and internationally.

This case was approached skillfully and carefully due to its unique nature where the large, integrated operations had the potential to significantly impact the Canadian market for sheep and lamb. Substantially all of the properties were sold, and the net proceeds of sale were distributed to the first ranking secured creditors. Despite having run out of cash, if the operations had ceased immediately third party suppliers of lambs to the processing plant would have had to find an alternative processor for their lambs resulting in widespread negative impact to the Canadian lamb market. Dynamic pricing, the cyclicality of the business and the challenge of winding down different aspects of the business in a coordinated manner were significant as was the protection of animal health and welfare.

McMillan acted as counsel to the lender, The Bank of Nova Scotia (“BNS”), in connection with their approximately $15 million loan to North American Lamb Company Ltd. (“NALCO”) and its subsidiaries.

Led by Adam Maerov, McMillan’s multi-disciplinary team comprising Kourtney Rylands, Daniel Shouldice, Preet Saini, Melanie Cheddi, and Mitchell Allison demonstrated their expertise in generating creative solutions when advising on complex cross-border restructuring matters.

McMillan’s Restructuring & Insolvency Group is one of Canada’s leading business insolvency groups. Our highly skilled team includes top-ranked lawyers known for their expertise and creative problem-solving, allowing McMillan to deliver the highest standards of transactional and structuring leadership, and commercial advocacy. We have advised on the restructuring, purchase and sale of businesses in a variety of industries. We regularly work with financially challenged companies, boards of directors, Canadian and US financial institutions, lending syndicates, bondholders, investors, ad hoc and official creditors’ committees, court-appointed officers and major customers and suppliers of insolvent companies. We provide our clients with successful outcomes and comprehensive solutions to the most challenging problems.