Beleave Requests Creditor Protection To Pursue Asset Sale

Well, the much expected has finally happened. This morning, Beleave Inc (CSE: BE) finally announced that it, along with its affiliates, has received approval from its directors to make an application for creditor protection. The application for the court order will be made today, on June 5.

Beleave Inc's Logo

In connection with the application, the company will look to appoint Grant Thornton as monitor of the company as its seeks protection under the CCAA. The process is being sought as a means of receiving a stay of proceedings that would allow Beleave to have a going concern transaction with that of Hegedus Consulting Services Inc.

Evidently, Hegedus Consulting has made an offer to purchase substantially all of the assets of the company – without the associated liabilities, essentially. Hegedus would provide a debtor-in-possession loan to fund the proceedings, as well as what amounts to a “stalking horse bid” for the sale of the assets.

The company has indicated that upon granting of creditor protection, day-to-day operations of the firm and obligations to employees and key suppliers would continue to be met.

As of December 31, 2019, Beleave had $2.7 million in current assets, which consisted of $120,406 in cash and $1.8 million in inventories. The firm listed $20.6 million in non-current assets, including $17.8 million in property, plant and equipment. Total assets were stated as being $23.3 million

Comparably, during the same period the company listed $16.9 million in current liabilities, including payables of $4.9 million and borrowings of $11.3 million. Total liabilities amounted to $16.1 million.

Given that the value of the stalking horse bid was not provided within the press release, its unclear what, if any, funds will remain for shareholders once all liabilities are covered.

Beleave last traded at $0.015 on the CSE.

Information for this briefing was found via Sedar and Beleave Inc. 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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