San Industries Ltd. and affiliates (the “San Group”), British Columbia-based lumber companies, obtained protection under the Companies’ Creditors Arrangement Act (CCAA) on November 29, 2024, to address significant liquidity challenges. Founded in 1979, the San Group operates a vertically integrated forest products enterprise, from timber harvesting to lumber product sales. Despite historically profitable operations, the San Group faced pressures in 2023 from declining lumber markets, inflation-driven cost increases, rising interest rates, and the BC Highway 4 closure caused by a wildfire.

The company owes over $43 million to Business Development Bank of Canada (BDC) and $105 million to Royal Bank of Canada (RBC, formerly HSBC). Attempts to restructure debts with these primary lenders were unsuccessful, leading to the CCAA filing. The proceedings aim to implement a court-supervised sale and investment solicitation process (SISP), with current management intending to bid.

Deloitte serves as the monitor, with legal counsel including Farris for the San Group, Fasken for RBC, Blakes for the monitor, and BLG for BDC. KPMG is acting as the financial advisor to the San Group.