Creditor-Led CCAA Proceedings of the Pelican Group of Companies

The debtors are designers, manufacturers, and marketers of water sports and other outdoor recreational products, with operations in both Canada and the United States. Although the debtors experienced significant growth and expansion during and in the years following the COVID-19 pandemic, they have faced substantial financial difficulties since 2023. These challenges are primarily due to a sharp decline in demand for kayaks and other products after the pandemic-driven boom, coupled with large inventory surpluses, increased debt service costs to the lenders, and significant financial obligations under their leases.

The National Bank of Canada has commenced proceedings under the CCAA with the intention of initiating a going-concern SISP and completing sales transactions involving the Canadian and U.S. assets of the debtors. After obtaining CCAA protection in Canada, the proceedings were recognized by the U.S. court under Chapter 15 of the United States Bankruptcy Code. The sale of the Canadian assets has been completed, and negotiations are currently underway regarding the sale of the U.S. assets.

McCarthy Tétrault is assisting National Bank of Canada with a team led by Hugo Babos-Marchand that included Frédérique Drainville (Bankruptcy and Restructuring), Marjolaine Hémond Hotte and Jason Phelan (Financial Services).