Morris Industries is seeking creditor protection, according to a document sent anonymously to Yorkton This Week.
The company, which can trace its roots back to George Morris opening a garage in Bangor SK, called Morris Garage in 1924, and opened a plant in Yorkton in 1960 to start manufacturing Rod Weeders in the city,has been granted creditor protection.
Calls by Yorkton This Week to the company’s law firm in the matter McGougall Gauley LLP were not returned after leaving messages identifying this media outlet.
However, an article posted at www. thestarphoenix.com confirmed the protection application made by Morris Industries. The article noted the company “has been granted creditor protection after telling a Saskatoon court its ambitious growth strategy failed and it does not have enough money to pay its debts and continue operations.”
Morris Industries Ltd. — the public face of a group of related companies — made its application for protection under the Companies’ Creditors Arrangement Act (CCAA) after experiencing a “liquidity crisis” last month, court documents state.
The CCAA is a federal process that allows corporations owing more than $5 million to restructure while avoiding bankruptcy.
The Star Phoenix story stated according to the documents, Morris Industries’ ambitious and expensive growth strategy allowed it to introduce new products but was derailed by unforeseen warranty issues as well as slumping sales attributable to trade wars and poor weather.
According to its application, Morris Industries wants $3 million in interim funding for its restructuring plan, which may include selling assets, downsizing its head office in Saskatoon and laying off some of its 134 employees.
The plan may also include consolidating its manufacturing operations into a single facility — it currently has plants in Yorkton and Minnedosa, MB.
In an order dated Jan. 8, Justice Shawn Smith appointed Alverez & Marsal Canada Inc. to monitor the proceedings and gave Morris Industries until Jan. 18 to organize a more thorough plan, including arranging the interim financing if possible.