Morris-Rite Way deal close to complete

The deal that will see Rite Way Manufacturing buy Morris Industries is expected to close this month.

The purchase price has not been disclosed in documents available on the website tracking the Companies’ Creditors Arrangement Act process that Morris entered into in January.

On July 3, the court granted an extension until July 31 for the process to conclude.

Rite Way, through Superior Farm Solutions Ltd. Partnership, had issued a non-binding letter of intent to buy Morris in May.

The parties agreed to the terms of two proposed asset purchase agreements, says the sixth report from the court-appointed monitor Alvarez and Marsal, and they anticipate presenting the court with a vesting order in mid-July.

The report projects cash flow to the end of July at $6.5 million, allowing Morris to repay existing financing of $5.4 million.

The report also said Morris has finally been able to collect about $5 million of an estimated $12 million it invoiced its Australian dealer over the past year.

“The company continues to work with the Australian Dealer with respect to fulfilling upcoming forecast orders and arranging for procurement of parts,” said the report.

The outstanding money affected cash flow while the company also struggled with high inventory and other challenges leading up to seeking CCAA protection.

As of May 31, the company also had about $3.7 million in accounts receivable from dealers across North America and eastern Europe.

Contact karen.briere@producer.com

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