A Prairie processor's ambition to make high-value food-grade proteins from cold-pressed canola has hit the bottom of the bin.
Toronto-based BioExx, at its Saskatoon plant, has tried to commercialize Isolexx, a canola protein isolate, and a hydrolyzed canola protein dubbed Vitalexx, while selling food-grade canola oil and feed-grade canola meal.
Judge Frank Newbould of the Ontario Superior Court of Justice granted the company creditor protection Tuesday, running until Oct. 31.
In BioExx's application Monday,the company's lawyers described it as having been "unable to commercialize its technology or conclude agreements with strategic partners who would assist it in doing so."
The company and its Saskatoon arm, BioExx Proteins of Saskatoon (BPS), were listed as having liabilities totaling about $13.35 million.
BioExx said creditor protection was needed to allow for the launch of a sale process under the oversight of its monitor (BDO Canada), retain "key employees who increase the value of the assets to be sold" and "maximize recovery" for the stakeholders.
In a brief announcement Tuesday, the company's board said that "after consideration of the available alternatives," this option was found to be "in the best interest of stakeholders."
TSX trading of BioExx's common stock (TSX: BXI) has now been halted, a move expected to remain in effect pending the stock's delisting, the company said. BXI was trading at 0.5 cents per share last Friday, interim CEO John MacDonald noted in his affidavit Monday.
The company on July 22 closed a $3.5 million deal to sell off some equipment from its Saskatoon plant to BidItUp Auctions Worldwide.
BioExx then said it expected to close a deal for its Saskatoon building, land and "certain canola crushing assets" by the end of this month to Virtex Grain Farms for $7.5 million. The first sale was expected to go mostly toward "partial payment of a loan" from its first secured creditor.
BioExx in late July hired Ernst and Young Orenda Corporate Finance to explore a possible sale of the company and to do so "if feasible and subject to shareholder approval." In that process 13 different buyers entered non-disclosure agreements toward a possible sale but no offer was ever made, MacDonald said.
The company had sought a buyer after a deal with an unnamed "potential strategic partner" fell through. The unnamed partner, BioExx said, had opted to favour "a lower risk and more immediate focus on other vegetable proteins that are already commercially available."
BioExx had said in July it would still pursue "other existing opportunities" such as a proposed plant in Europe, but wanted to examine a possible sale "while sufficient financial resources exist to undertake such a process."
The company is also now in default on its repayments of a $2.958 million contribution put up in 2009 through the federal Agri-Opportunities program, due to be paid down in full by the end of September 2017.
The company launched in 2003 with what it described as a "groundbreaking, proprietary technology to naturally process oilseeds into food-grade oil and proteins, at low temperatures, without the use of noxious solvents."
The result of its process, BioExx said, was the "creation of a much higher quality protein than has ever been possible before." -- AGCanada.com Network
BioExx asks CEO to step down, Aug. 8, 2011
Toronto oilseed processor to build in N.D., July 24, 2009
Canola crusher inks supply deal with Viterra, May 14, 2008
T.O. firm says new cold-press canola process more efficient, Oct. 4, 2007