Five Burnaby clothing stores saved with $95 million payment to creditors

Five fashion stores in Burnaby have been saved — at least for now — as the parent company has repaid nearly $100 million to creditors.

Reitmans (Canada) Ltd. operates five clothing stores in Burnaby, with three Reitmans branded stores in Market Crossing, Metropolis in Metrotown and Lougheed Town Center, plus a South Burnaby Penningtons and a Metrotown RW&Co store.

But their future has been cloudy as the company filed for protection from creditors due to heavy losses, exacerbated by the COVID-19 pandemic.

Reitmans now says it has paid creditors $95 million as it emerges from creditor protection after about 20 months.

The Montreal-based company says it paid court-appointed monitor Ernst & Young Inc. to distribute the funds to creditors in accordance with the plan of arrangement.

A list of known creditors as of September 2020, posted online by the Comptroller, shows Reitmans owed a total of $192,656,167 at that time.

The company says it has also secured a credit facility of up to $115 million from the Bank of Montreal.

The funds will be used to pay creditors, for working capital and for other purposes, including new store openings and renovations.

Reitmans filed for protection from its creditors and obtained an initial order under the Companies’ Creditors Arrangement Act in May 2020.

The womenswear retailer operates 412 stores including 241 Reitmans, 93 Penningtons and 78 RW&CO.

  • With reports from the Canadian Press

Anne G. Cash