BC Craft Supply Co Files Notice Of Intention Under Bankruptcy & Insolvency Act

Well, it appears that even a 100 to 1 share consolidation couldn’t save BC Craft Supply Co (CSE: CRFT). The firm last night, after halting its equity, announced that it has filed a notice of intention to make a proposal under the Bankruptcy & Insolvency Act of Canada.

In layman terms, the company is looking to restructure itself due to drowning in its current debt. With the filing, the company will automatically enjoy a 30-day stay of proceedings, which prevents creditors from collecting on their debts.

The act is being used as means to “regain the company’s financial footing.” If it fails to do so, and creditors are not able to come to an agreement with the company, then the firm will likely end up bankrupt.

The move to file a notice of intent is effectively the last step the company has available to settle with creditors. As of June 30, 2021, the last period for which financials were filed, the company had just $0.1 million in cash on the books, while current liabilities totaled $8.2 million, of which $1.9 million was accounts payable, $2.3 million was promissory notes, and $3.5 million was attributed to convertible debentures. The firm had conducted the prior mentioned share consolidation as a means of obtaining financing to assist in satisfying these debts, however it appears that no interest in such a financing ever materialized.

The firms day to day operations are expected to remain uninterrupted as it goes through the restructuring process.

BC Craft Supply Co last traded at $0.44 on the CSE.

Information for this briefing was found via Sedar and BC Craft Supply Co. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.

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