Paul Martin commentary
It’s the biggest financial failure in Canadian agriculture since virtually the entire hog industry changed hands after the nation’s two biggest players went into receivership within days of each other nearly 15 years ago.
Monette Farms is seeking court protection to restructure its finances, a process called CCAA or Companies’ Creditors Arrangement Act. The idea is to give the owners some breathing room to come with a plan that creditors such as lenders or suppliers can accept or reject.
Acceptance allows the firm to carry on under a revised structure. Rejection means bankruptcy.
With 400,000 acres under management across the four western provinces and into the US, Monette is one of the biggest farming operations in the world with roughly a billion dollars in secured or senior debt owning to lending institutions in addition to other commercial obligations. It also had diversified into the cattle production, produce and seed businesses.
Timing on this one is particularly important. With spring seeding a matter of days away decisions will be required in short order if the land is going to generate crop revenue this season.
