Tahera Obtains CCAA Protection from Creditors
January 17, 08
Canadian diamond miner Tahera has obtained protection from creditors pursuant to the provisions of the Companies' Creditors Arrangement Act (CCAA) from the Ontario Superior Court of Justice for a 30-day period, to expire on February 14. The order, granted to Tahera and its subsidiaries on Wednesday, can be extended or terminated on that date. While under CCAA protection, Tahera's management "will remain responsible for the day-to-day operations, under the supervision of a court-appointed monitor, PricewaterhouseCoopers Inc., who will be responsible for monitoring Tahera's ongoing operations, assisting management with the development and filing of a restructuring plan, liaising with creditors and other stakeholders and reporting to the Court," Tahera said in a release. Earlier on Wednesday, the miner said it is seeking protection under CCAA, ”as its current cash flows and cash on hand would not allow it to meet its current obligations and its obligations with respect to the 2008 winter road resupply,” it stated in a release. The CCAA filing follows a review by the board of directors. The board determined that, “as a result of insufficient indications of interest in Tahera's best efforts equity offering and the absence of any viable strategic alternatives at this time, seeking CCAA protection would be in the best interest of all stakeholders.“ The CCAA process, according to Tahera, will stay creditors and others from enforcing rights against the company and its subsidiaries, allowing it to restructure its operations and “find the alternative that will be in the best interest of all stakeholders.” Tahera owns the Tahera noted that the implications for its shareholders under the CCAA protection are less clear and will not be able to be determined until the end of the restructuring process. The company will withdraw its amended and restated preliminary prospectus filed in connection with its best efforts units offering.