Motovan issues letter regarding financial problems

For a while now, there’s been talk of financial troubles at Motovan, one of Canada’s largest powersports distributors, especially since it closed down its Edmonton warehouse. Now, we’ve got the following note from the company’s CEO, which talks a bit more about what’s going on. The tl/dr version: Motovan isn’t bankrupt, but is under legal protection while it restructures under the Companies’ Creditors Arrangement Act.

Based in Boucherville, Quebec, Motovan grew significantly in recent years due to its purchases of Steen Hansen Racing and US-based MTA Distributing. Its brands include TCX boots, Shoei and Zox helmets, Olympia riding gear, and many others.

You can find information on Motovan’s situation here; otherwise, here’s what Motovan wrote earlier this week:

Dear Valued Customer,

On December 2nd, 2019 due to certain business and financial challenges we face, Motovan Corporation
and Motorcycle Tires & Accessories LLC (collectively the “Company”) voluntarily filed proceedings
under the Companies’ Creditors Arrangement Act (“CCAA”), which establishes a formal restructuring
process while obtaining the protection of the law during the process.

The Company is NOT bankrupt and will continue its operations as usual.

In the coming weeks, the Company will establish a plan while in the CCAA process, giving us the
flexibility to ensure you receive the service you are accustomed to from the last 40 years. Please
understand that this is a necessary step since the process will provide the financial security and the
protection of the court for the establishment of a business strategy to ensure its eventual growth and
long-term profitability.

The company will continue to be led by its current management team and our family as we have in the
past. Furthermore, KPMG Inc. was appointed Monitor by the Court and they possess a vast experience
and expertise in such processes.

Be sure that we will work diligently on the plan to ensure our success and continue our business
relationship with you. For those who have open orders, this remains unchanged as during this process
we will work with our vendors to make sure you get the needed inventory as quickly as possible.

Subsequently on the next page you will find some frequently asked questions about the current
situation as I am sure many of you have additional questions.

On behalf of my dad, brother and our loyal employees, I would like to sincerely thank you for your
understanding and support throughout this period.

Best Regards,

James Paladino, MBA
President and CEO

 

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