Cadillac Fairview's Bankruptcy Protection Approved, Setting Stage for Restructuring

Cadillac Fairview Inc., Canada's largest real estate empire, has been granted bankruptcy protection by a Toronto court, paving the way for the company to restructure its debt and avoid liquidation. The company owes over $5.28 billion, including $1.01 billion in senior debt and $1.95 billion in subordinated debt. As part of the restructuring process, Cadillac has until January 31 to propose a plan to restructure its debt and has already received proposals from two potential investors. Goldman Sachs, which owns about 28% of Cadillac's senior debt, is expected to submit a revised bid.

Key Takeaways:

• Cadillac Fairview Inc. has been granted bankruptcy protection by a Toronto court, allowing the company to restructure its debt and avoid liquidation.
• The company owes over $5.28 billion, including $1.01 billion in senior debt and $1.95 billion in subordinated debt.
• Cadillac has until January 31 to propose a plan to restructure its debt and has already received proposals from two potential investors.
• Goldman Sachs, which owns about 28% of Cadillac's senior debt, is expected to submit a revised bid.
• Lawyers representing subordinate debtholders argue that stakeholders should have the chance to evaluate all bids, not just the one Cadillac deems most favorable.
• Cadillac and junior debtholders have argued that Goldman Sachs was seeking to destabilize the company and pick up the pieces at bargain prices.
• The company owns high-profile properties such as Winnipeg's Portage Place, Vancouver's Pacific Centre, and Toronto's Eaton Centre and Toronto-Dominion Centre.
• The court ruling will accelerate the restructuring of Cadillac's debt and potentially allow Goldman Sachs to increase its bid.

Statistics:

• Cadillac Fairview Inc. owes over $5.28 billion, including $1.01 billion in senior debt and $1.95 billion in subordinated debt.
• The company has $2.32 billion in mortgage debt.
• Goldman Sachs owns about 28% of Cadillac's senior debt.
• The company has until January 31 to propose a plan to restructure its debt.
• Cadillac has proposals from two potential investors to assist in its restructuring.
• Goldman Sachs is expected to submit a revised bid.

Sources:

• "Cadillac Fairview Inc.'s application for bankruptcy protection was approved late last night, allowing it to hold creditors at bay while it works out a restructuring plan for its insolvent real estate empire."
• Bloomberg Business News
• The Globe and Mail