MONTREAL 鈥� After 60 years in operation, Le Chateau Inc. is seeking court protection from creditors to allow it to liquidate its assets and close its stores, including four on Vancouver Island.
The Montreal-based company said Friday that it has spent much of the COVID-19 pandemic trying to refinance or sell the business to a third party that would keep it in operation, but was unsuccessful.
鈥淚ts already evident impact on consumer demand for Le Chateau鈥檚 holiday party and occasion wear, which represents the core of our offering, has diminished Le Chateau鈥檚 ability to pursue its activities,鈥� the company said.
鈥淩egrettably, these circumstances leave the company with no option other than to commence the liquidation process.鈥�
The company鈥檚 application for protection from creditors under the Companies鈥� Creditors Arrangement Act will be heard by a Quebec court on Friday.
Le Chateau said it intends to remain fully operational as it liquidates its 123 stores, but the eventual closures will mean the end of about 1,400 jobs 鈥� 500 at its head office and 900 at stores.
鈥淲e regret the impact this will have on our people and can assure you that we explored all options available to us prior to taking this difficult decision,鈥� the company said.
The company has three stores in Greater Victoria, in the Victoria Bay Centre, the Mayfair Shopping Centre and in Millstream Village. Another is in Nanaimo鈥檚 Woodgrove Mall.
Le Chateau expects Gordon Brothers sa国际传媒 ULC and Merchant Retail Solutions ULC to be appointed as consultants to implement the liquidation and PricewaterhouseCooper Inc. to become its monitor in CCAA proceedings.
If Le Chateau鈥檚 CCAA application is granted, the company will obtain interim financing from Wells Fargo Capital Finance Corp. sa国际传媒 to help it fund post-filing working capital requirements.
The company鈥檚 application comes after several other Canadian retailers have shuttered or downsized operations in the wake of the pandemic.
Reitmans sa国际传媒 Ltd., Aldo Group Inc., DavidsTea Inc., Mountain Equipment Co-operative, Moores the Suit People Corp. and Laura鈥檚 Shoppe Inc. are among the dozens of retailers that have all filed for CCAA.
This report by The Canadian Press was first published Oct. 23, 2020.
