A federal judge in Texas today signed off on ENTREC’s bankruptcy plans, allowing the Canadian heavy equipment hauler to continue operating while it courts buyers or investors under creditor protection.
The decision by U.S. Bankruptcy Judge Marvin Isgurf normally recognizes ENTREC’s Canadian creditor protection proceedings under Chapter 15 of the U.S. Bankruptcy Code. It also designates ENTREC’s Companies’ Creditors Arrangement Act (CCAA) proceedings as the primary venue for the cross-border bankruptcy.
ENTREC sought a joint administration in the interest of keeping its Canadian and U.S. trucking and crane services businesses in operation as it pursues asset sales and investments. Court filings show the book value of its assets, properties and equipment at C$87.4 million (about US$63 million). Its leased equipment is worth about C$38.3 million.
CEO John Stevens had warned that a separate U.S. proceeding for its Texas subsidiary could lead to a premature liquidation of the company, hurting employees and creditors alike.
A judge in Canada approved ENTREC’s CCAA plans on Monday, May 25. ENTREC will continue operating with extended financing of up to C$30 million from a syndicate of creditors led by Wells Fargo.
The Alberta-based company specializes in transporting and lifting heavy equipment and other oversized loads for heavy industries including the oil sector. ENTREC has 370 employees, 115 tractors, and 125 cranes and picker trucks.
The company filed for creditor protection after COVID-19 and the collapse in oil prices hit its already struggling business.
ENTREC operates Alberta-based Capstan Hauling and ENT Oilfield Group, and Texas-based ENTREC Cranes & Heavy Haul.