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There were 64 filings under the Companies’ Creditors Arrangement Act (Canada) in 2023, which is an approximately 64% year-over-year increase. While this surge is interesting in and of itself, we believe that the volume of 2023 CCAA filings is also notable for the rich data it makes available to insolvency professionals. We used this opportunity to better understand how the CCAA was being employed by reviewing each filling. We will continue to monitor the CCAA filings made in 2024 and try to discern any trends that may be of interest to insolvency professionals making the decision on when and how to have resort to the legislation.
2023 by the numbers
Download Miller Thomson’s 2023 CCAA tracking spreadsheet.[1]
Of the 64 CCAA filings in 2023:
- 28 were made in Ontario, 18 were made in Quebec, 7 were made in British Columbia, 4 were made in Alberta, 3 were made in Newfoundland, 2 were made in Manitoba, 1 was made in New Brunswick, and 1 was made in Nova Scotia.
- The mining industry represented the majority of filings (8), followed by healthcare (7), manufacturing (6), food / hospitality (6), supply / distribution (5), cannabis (5), energy (5), financial services (5), real estate (5), technology / media / entertainment (4), retail (3), automotive (2), equipment / leasing (1), construction / servicing (1), and infrastructure (1)
- 17 filings were made by public companies and 47 by private companies.
- 6 debtors had a pension plan.
- The debtors’ total liabilities ranged from $5,575,000 to $921,131,200, with a mean average of $176,430,270.58
- The debtors’ total assets ranged from, $1,200,000 to $501,000,000, with a mean average of $130,777,200.58
- 45 filings required interim financing, with DIP loans averaging $8,832,894
- Cross-border proceedings were rare, with only 11 of Canadian filings accompanied by a parallel Chapter 11 proceeding or Chapter 15 recognition proceeding.
- As at January 15, 2024, 41 of the filings involved a sale and investment solicitation process (each a “SISP”). Of those 41 SISPs, 23 were completed, 18 were still in progress, and 9 featured a stalking horse bidder. 14 SISP transactions proceeded by way of reverse vesting order. No SISP resulted in a plan or compromise or arrangement (a “Plan”).
- The average SISP bid deadline[2] was 45 days following Court approval of the SISP, with 24 days representing the shortest initial bid/indication of interest window and 88 days representing the longest.
- As at January 15, 2024, 9 of Plans had been filed with the supervising Court.
- Professionals mandates (Download our Professional Mandates (PDF).
Preliminary takeaways
We believe the following metrics warrant further study and a comparison to historic and future data:
- In 2023, the CCAA was used predominantly as a going-concern sale or liquidation statute.
- Of the nine SISPs which featured a Stalking Horse Bidder, three resulted in auctions.
- RVOs are becoming the dominant tool for implementing sale transactions. RVOs were utilized in the following industries: healthcare (3), financial services (3), cannabis (2), manufacturing (2), automotive (1), technology / entertainment / media (1), energy (1), and mining (1). RVOs were not used in the real estate, supply / distribution, and retail industries.
[1]The information provided herein is intended for reference purposes only. While every effort has been made to ensure the accuracy of the data presented, no representations are made regarding the completeness or accuracy the information. Users are encouraged to independently verify the information contained herein.
[2] In a multi-phase SISP, we consider the phase 1 bid deadline to represent the bid deadline.
