Canada’s biggest mushroom producer has asked for and received creditor protection until Jan. 9 in a bid to restructure its business.
Rol-land Farms, based at Blenheim, Ont., about 100 km east of Windsor, was also the operation at the centre of a court ruling last month quashing Ontario’s ban on collective bargaining by farm workers.
The company plans to “deal with its assets in a manner consistent with the preservation of its property and business,” according to a memo Thursday from PricewaterhouseCoopers, the firm monitoring the protection order.
In a press release Thursday, Rol-land Farms said it’s “in the best interests of its shareholders, employees and creditors to seek protection and to restructure so that it can emerge as a stronger and more viable operation.”
Though the company didn’t elaborate, it said the decision is “a result of current economic circumstances.”
The company said in its release that it has the “full support” of its bank, which is providing debtor-in-possession (DIP) financing. DIP financing gives the debtor in question priority over other equity positions or secured interest in a company.
Rol-land bills itself as the third largest mushroom producer in North America, supplying about a million pounds of mushrooms a week to retailers across Canada and the U.S.
The company operates farms in Ontario, Alberta and Prince Edward Island, and also runs greenhouse operations with capacity to produce seedlings for tomatoes, cabbage, onions, peppers, watermelon, broccoli, cauliflower, celery and tobacco. In Ontario it also grows processing tomatoes, peppers, seed corn, grain corn, soybeans and wheat on 1,750 acres.
The Ontario Court of Appeal last month knocked down the province’s Agricultural Employees Protection Act following a court challenge by the United Food and Commercial Workers (UFCW) union on behalf of three Rol-land workers.
The appeal court’s ruling said the Act “fails to recognize the evolving nature of Ontario agriculture,” such as the general trend toward corporate farms and more complex agribusinesses.