Delay in the Acquisition of Lion Electric Now Set for Next Week.
Title: Hold Off on Lion Electric's Investor Takeover - Creditors Brace for Possible Losses
Ahoy, Mates! John Doe and Porter Smith here, keeping it real and unfiltered. Time's a-tickin', so let's dive in. The initial takeover of Lion Electric by a group of investors was due this Friday, but it's been pushed back to next Wednesday, giving both parties a bit more time to scrutinize the offer.
Now, here's the skinny. Alain Riendeau, representing the banking syndicate, let it all hang out during the Superior Court hearing. He declared that "Our bank account is practically empty. There are no additional funds that can be advanced." Lion Electric's Canadian assets, based in Saint-Jérôme, have been shielded from creditors since December 2024, but the going's been tough. "Even if the offer is meager, it at least keeps the company's activities afloat. And that's not nothing," Riendeau added.
Got that? Yeah, it ain't much, but it's something. Judge Michel Pinsonneault decided to hold off on the approval because, well, he didn't have all the docs. "I'm called upon to decide, but I must be able to decide with full knowledge of the facts. I have not been able to read 95% of the documents that were sent to me," the judge explained.
So, what's the big deal? There'll be plenty of discussions ahead. You see, the investor group aiming for Lion Electric's Canadian operations couldn't piggyback on financial aid from Quebec during the takeover. The controller's report states that the deal terms don't allow Lion to "fully repay the provisional financing granted by the provisional lenders." Result? The exception of the interim lender, "all amounts that could be due to creditors [...] will not be repaid."
Things ain't looking great for the creditors, but hey, let's keep it moving. Lion Electric's lawyer, Guy P. Martel, stated during the hearing that it would probably be wise to wrap things up as soon as possible. The same sentiment was echoed by Jean Legault, attorney for the controller Deloitte. "It's evident that we need to know quickly if there's a transaction because the financial means, the liquidities, are severely limited," Legault stressed.
Who are these investors? Glad you asked. The investor group consists of businessman Vincent Chiara, president and founder of real estate promoter Groupe Mach, entrepreneur Pierre Wilkie, and financier Claude Boivin. Their ambitious plan for Lion Electric was shot down by the Legault government, denying around $24 million in investment for the takeover.
Last but not least, how does this impact the IAM union? Well, let's just say it's been a heck of a ride. Eric Rancourt, international representative of IAM Canada for Quebec, put it this way: "The past few months have been a rollercoaster of emotions." However, he emphasized the potential jobs that could be preserved at the Saint-Jérôme plant.
A quick recap. Lion Electric had a strong start, debuting on the Toronto Stock Exchange and Wall Street in May 2021. However, struggles followed; in November 2021, the first wave of layoffs (150) occurred. After refocusing its strategy in July 2024, abandoning truck assembly in the U.S., and announcing near-empty coffers in November 2024, the company sought bankruptcy protection in December 2024. In April 2025, a Quebec-based group's takeover bid was accepted, but the Legault government ultimately decided not to reinject money into the company. In May 2025, the Quebec investor group returned with a new purchase offer.
To wrap it up. Creditors might have a hard road ahead, but let's keep our fingers crossed that a fair deal can be struck. The company's employees are left in limbo, hoping for stability and continued employment. Here's to hoping that these investors can work their magic!
May 2021: Lion Electric scores its Toronto Stock Exchange and Wall Street debut.November 2023: First round of layoffs (150) hits.July 2024: Lion refocuses strategy and abandons U.S. truck assembly.November 2024: Announcement of almost empty coffers.December 2024: The company seeks protection from its creditors.April 2025: A Quebec-based group's takeover bid is accepted.May 2025: The Quebec investor group returns with a new purchase offer.
The French-Canadian industry of Lion Electric faces uncertain financial times as the investor takeover is delayed, potentially impacting the business's viability and the security of its employees. The financial situation of the company, with its Canadian assets in Saint-Jérôme, is precarious, with severely limited liquidities and a possible inability to repay creditors, according to the controller's report.
