Structurlam Mass Timber files Chapter 11 bankruptcy in Delaware

By Sarah Lizee

Olympia, Wash., April 24 – Structurlam Mass Timber U.S., Inc. and three affiliates filed Chapter 11 bankruptcy on Friday in the U.S. Bankruptcy Court for the District of Delaware.

The group is also starting proceedings in Canada for its British Columbia-based businesses.

The company said in a Monday morning press release that it has entered into a stalking horse agreement with Mercer International Inc. to sell substantially all of its assets in British Columbia and Arkansas for $60 million.

The agreement is subject to higher and better offers as part of a court-monitored auction process.

In addition, the company has lined up a C$7.5 million debtor-in-possession facility from the Bank of Montreal to fund its operations throughout the process.

“I am delighted and grateful for Mercer’s vote of confidence in Structurlam and in its leadership in the mass timber industry,” chief executive officer Matthew Karmel said in the release.

“It is especially rewarding given the difficult period the company has had since suspending its operations in Arkansas mid-January, and it will help in normalizing the plant operations going forward.”

In its petition, the company listed 200 to 999 creditors, $100 million to $500 million in assets and $100 million to $500 million in liabilities.

Its largest unsecured creditors are Walmart, Inc., based in Bentonville, Ark., with a $34 million contract counterparty claim, Stiles Machinery Inc., based in Chicago, with a $1.3 million contract counterparty claim and Stuart Olsen Construction, based in Richmond, B.C., with a $1.2 million contract counterparty claim.

Alvarez & Marsal Canada Inc. is financial adviser, Paul Hastings LLP is general bankruptcy counsel, Potter Anderson & Corroon LLP is local bankruptcy counsel, and Stifel, Nicolaus & Co., Inc. and Miller Buckfire & Co., LLC are investment bankers for the U.S. proceedings.

Alvarez & Marsal Canada Inc. is information officer and Gowling WLG (Canada) LLP is legal adviser in connection with the Canadian proceedings.

The manufacturer of mass timber solutions has headquarters in Penticton, B.C. The Chapter 11 case number is 23-10497.

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