February 28, 2017
Torys represented Fairfax Financial with a team led by David Chaikof and that included Thomas Yeo, Josh Lavine, Marissa Daniels and Simonne Horwitz (M&A/securities), David Bish, Adam Slavens and Lily Coodin (restructuring/insolvency), Amanda Balasubramanian (banking/financing), John Tobin (tax) and Omar Wakil (competition).
On February 28, 2017, in the culmination of a complex cross-border bankruptcy sales and auction process, Performance Sports Group Ltd. (PSG) announced the completion of the sale of substantially all of its assets to an investor group led by Sagard Holdings Inc. and Fairfax Financial Holdings Limited for US$575 million, subject to certain adjustments, and the assumption of related operating liabilities.
The new, privately held company will be a leading developer and manufacturer of ice hockey, roller hockey, lacrosse, baseball and softball sports equipment, and related apparel. Its products will be sold under the BAUER, MISSION, MAVERIK, CASCADE and EASTON brand names and will be marketed and distributed worldwide.
The sale was completed in connection with PSG’s cross-border restructuring proceedings which commenced on October 31, 2016 with joint proceedings in the Ontario Superior Court of Justice under the Companies’ Creditors Arrangement Act and the U.S. Bankruptcy Court for the District of Delaware under Chapter 11 of Title 11 of the U.S. Code.
The Sagard/Fairfax-led investor group made the “stalking horse” bid at the outset of the sales and auction process, which was ultimately determined to be the successful bid. To provide working capital for PSG’s operations and to fund the auction and sales process during the restructuring process, PSG’s existing asset-based lenders and Fairfax and Sagard provided PSG with an aggregate of U.S.$386 million in debtor-in-possession (DIP) financing. Both Canadian and U.S. courts approved the sale and associated reorganization transactions pursuant to orders dated February 6, 2017 and supplemented on February 10, 2017. Upon completion of the sale, PSG ceased to exist as an operating business and is in the process of allocating and distributing the sale proceeds to the debtors’ stakeholders through liquidation plans in the U.S. and Canadian bankruptcy proceedings.
Fairfax Financial is a holding company which, through its subsidiaries, is engaged in property and casualty insurance and reinsurance and investment management.
Sagard Capital is an evergreen fund with an indefinite holding period for its investments. It’s strategy is to acquire significant minority or control positions in small and mid-sized companies.
Further information can be found on PR Newswire’s website.