A Saskatoon judge has granted the Morris Group, including its mainstay Morris Industries, financial protection from its creditors.
According to court documents, the company applied for protection under the Companies’ Creditors Arrangement Act while it undertakes a restructuring plan.
The affidavit filed by chief operating officer Kevin Adair said Morris after its 2017 restructuring “undertook a number of strategic initiatives that aimed to be faithful to Morris Industries’ history and the expectations of its customer base (i.e. providing innovative products based on the farming community’s actual needs) while also aggressively growing its overall business in anticipation of an upward trend in the agricultural economy.”
Read Also
Agriculture ministers agree to AgriStability changes
federal government proposed several months ago to increase the compensation rate from 80 to 90 per cent and double the maximum payment from $3 million to $6 million
However, the costs incurred, combined with other factors, put the company in a poor financial position.
The documents indicate Morris is carrying higher than usual inventory values that its credit facilities can’t accommodate.
It also faced significant unforeseen warranty costs with its Quantum Drill, introduced in 2018. The drill openers were upgraded in North America, but in Australia they had to be replaced.
The company cited American steel tariffs and poor weather as other factors.
A temporary $3 million amendment to its operating line allowed the company to meet payroll and other obligations until Jan. 8 and now Morris requires interim financing to continue operating as it works on restructuring.
Contact karen.briere@producer.com
