July 19, 2012
Willkie Advises Alvarez & Marsal in Arctic Glacier’s Cross-Border Restructuring, US Court Approves $435 Million Company Sale.
On July 17, it was announced that Winnipeg, Canada-based Arctic Glacier Inc. received approval for its $435 million purchase by Miami, Florida-based private equity firm HIG Capital LLC. On February 21, Arctic Glacier had initiated proceedings under the Companies’ Creditors Arrangement Act (CCAA) in the Court of Queen’s Bench, Manitoba, with U.S. affiliates of the packaged-ice producer filing for chapter 15 protection in Delaware bankruptcy court the following day. Willkie represents Alvarez & Marsal, the court-appointed Monitor in the Canadian CCAA proceedings and the foreign representative in the chapter 15 cases.
Primary to the selection of HIG Capital from among the three final bidders, as reported by Law360 which quoted from Mary Warren’s courtroom presentation, was that HIG’s was the highest bid with the fewest conditions to closing. In addition, she said, the terms of the HIG deal allow Arctic Glacier to continue to operate as a stand-alone, Winnipeg headquartered company, and HIG is prepared to offer employment to all of Arctic Glacier’s current employees, both full- and part-time. After a claims process is completed in the CCAA proceedings, the Monitor may even be able to make a distribution to equity. U.S. Bankruptcy Chief Judge Kevin Gross noted the outstanding results achieved on behalf of the debtors while signing off on the sale, which is expected to close on July 25.
With 39 production plants and 47 distribution facilities across Canada and the United States, Arctic Glacier serviced more than 75,000 retail locations and held assets of $65 million and liabilities of $240 million as of September 30 according to its initial filing. Arctic Glacier currently employs approximately 750 people in the U.S. and 210 in Canada.
Miami-based HIG Capital has offices throughout U.S., Europe and South America and targets small and mid-sized companies with growth potential. Experienced in spearheading turnaround efforts and financial restructurings, HIG currently manages $8.5 billion in equity capital.