Certain classifications of Laurentian University’s creditors were recently paid back what they’re owed.
This information was revealed in a “plan implementation status” report put out Dec. 13 by Ernst & Young, which is the firm that has acted as the court-appointed monitor of Laurentian’s insolvency restructuring.
In February 2021, Laurentian University became the first publicly funded university in Canada to file for protection under the Companies’ Creditors Arrangement Act (CCAA). Laurentian’s journey under the CCAA was to last the rest of 2021, as well as most of 2022, for a total of 22 months in all.
After having its debt plan, known as a plan of arrangement, approved by creditors earlier this fall, Laurentian finally exited insolvency on Nov. 28.
Laurentian’s plan of arrangement said the university would pay back in full certain classifications of claims against the university, including those made by secured creditors and those owed vacation pay. According to the Ernst & Young report, this has now been done.
The report said “payment in full of all secured claims have been made by wire or cheque as of November 28, 2022.”
In addition, after a review by Employment and Social Development Canada, “all vacation pay compensation claims (net of any required withholdings) have been paid by cheque on December 13, 2022.”
The rest of Laurentian’s creditors have been told they can expect to receive only roughly 14 to 24 per cent of what they’re owed over the next three years.
A pool of cash of up to $53.5-million for Laurentian’s creditors is to come from the sale of university real estate to the province of Ontario, as per an agreement this spring with the province. The minimum floor for the pool of cash has been set at $45.5 million.
The recent Ernst & Young report also refers to these creditors.
“In accordance with the plan, distributions to affected creditors with unsecured proven claims will be made at a future date once net sale proceeds have been received,” said the report. “Further updates will be posted when available.”
Heidi Ulrichsen is Sudbury.com’s associate content editor. She also covers education and the arts scene.