Laurentian seeks extension to Nov. 30 to emerge from insolvency

A powerful committee of the Ontario legislature moved Wednesday to try and force Laurentian University to hand over privileged documents to the province's auditor general. (File)

Laurentian University is seeking court approval to extend the deadline to emerge from insolvency until Nov. 30 to give it time to implement its financial restructuring plan.

Currently, loans the university received to keep operating are due Sept. 30. Known as DIP loans, LU is looking to extend that deadline when they must be repaid for two months.

The university declared insolvency under the Companies' Creditors Arrangement Act (CCAA) in February 2021. A plan to repay creditors a percentage of what they are owed was approved at a hearing earlier this month.

Formally known as the plan of arrangement, that agreement must be confirmed by the court, with a hearing scheduled Oct. 5. Under the CCAA, that hearing is called the sanction hearing.

Because the DIP loans are due Sept. 30, LU is seeking to extend that date first to Oct. 7, then if the plan of arrangement is confirmed, until Nov. 30 to give it time to implement the plan and emerge, finally, from insolvency.

"The requested brief extension of the stay period is required to enable LU to continue operating in the ordinary course while preparing for the sanction hearing," said court documents the university filed in the case.

You can read them here.