With over $52 million owed to creditors, North American Lamb Company (NALCO) — a Manitoba and Alberta-based, integrated lamb supply chain business — has filed for creditor protection, as of August 8, 2022.
Formed when Canada Gold Beef Ltd, owners of the Innisfail Alberta based SunGold Specialty Meats Ltd., the Canada Gold Lamb Lot near Iron Springs Alberta, and Fresh Canada Meats Ltd, the Canadian subsidiary of New Zealand’s Integrated Foods Ltd merged in 2018, documents published on the insolvency show huge debts to Farm Credit Canada (FCC), Bank of Nova Scotia (BNS), and Fresh Canada Meats Ltd.
Documents posted by court-appointed monitor Ernst and Young show the company had yet to turn a profit since 2018. “By May 2022, the NALCO Group faced a severe liquidity challenge and began delaying payments to non-essential creditors to preserve cash. This crisis ultimately culminated in both of the NALCO Group’s primary secured creditors, BNS and FCC, serving notices of intention under the Farm Debt Mediation Act and the BIA.”
On August 17, 2022, the court approved an amended and Restated Initial Order (ARIO), which includes a stay of proceedings until December 9, 2022. The stay is intended for NALCO Group to carry out a sale of the business while under creditor protection.
Pursuant to the ARIO, the NALCO Group is obligated to continue carrying on business in a manner consistent with the preservation of its business and property, Ernst and Young says.
Sources also say the SunGold processing plant in Alberta continues to operate. It’s unclear how many ewes are currently part of the value chain, though the company listed a ewe flock of over 35,000 at the time of the merger.
According to documents, Farm Credit Canada is owed over $24 million, and Bank of Nova Scotia over $14 million
This is a developing story. Details will be added as they become available.