I seem to remembr reading an anecdote about the guys who started MEC were sitting in a tent weathered out and jokingly were going to it the fast buck co-op or something like that
MEC in recievership
Are they already closed? I was near the store near VCC & the offices / parking lot looked empty.
Anyone receive the MEC email today?
MEC
Dear valued member,
We recognize this has been an unsettling week for members. The sale of MEC’s business, and the decision to move the business away from the co-operative model was, after all, a very difficult decision – but it was the right one. Facing a stark choice, we chose to preserve employment opportunities, a larger store presence, and a commitment to MEC’s ethos rather than fold up the MEC tent for good.
As you may know, this week, MEC filed for protection under the Companies' Creditors Arrangement Act ("CCAA"). Effectively, this was a recognition that MEC was financially insolvent, and in dire need of support to continue moving forward. Fortunately, at the same time, our Board of Directors announced unanimous support for an agreement with Kingswood Capital Management, LP. The agreement with Kingswood will ensure that MEC has a brighter future.
We’ve heard your questions, let us attempt to answer them:
First, you’re probably wondering, “what happened?”
MEC has experienced increasing performance issues since 2016. In July 2019, new leadership was brought in to develop a plan to turn MEC around. We were making significant progress but then the global pandemic hit and exacerbated MEC’s financial challenges.
A Special Committee of the Board engaged in an extensive examination of options to address the persistent financial issues. As part of the review, the Special Committee, in concert with expert advisors, sought refinancing from over 65 potential lenders, proactively explored and leveraged applicable government support programs, and examined funding MEC through voluntary member assessments.
Ultimately, a sale was the only option that would save MEC from bankruptcy or liquidation.
We’ve been asked, “what is CCAA?” and “why don’t members vote on this decision?”
Our persistent financial challenges combined with the pandemic created a situation in which MEC became insolvent, and this necessitated a filing under CCAA. In CCAA, the court oversees the restructuring process to ensure fairness. A member vote (or in the case of corporations, a shareholder vote) is not required.
CCAA allows an organization to maintain its business ‘in the ordinary course’ while giving it the breathing room necessary to restructure its affairs. This is done to preserve as much of its business as possible for the benefit of employees, members/customers, suppliers and other stakeholders in the communities in which it operates.
Many are wondering “why wasn’t the board more forthcoming or transparent?”
First of all, we understand that many are upset and apologize for not communicating more or sooner. As a member-based co-op, we know the importance of transparency, and value co-operative principles. But in exercising our fiduciary duty, the board’s top priority was preserving jobs and saving MEC from bankruptcy or liquidation. In short, we prioritized MEC’s survival.
Since our founding in 1971, MEC’s deeply loyal members have been synonymous with who we are and what we do. That will not change. MEC will continue, and our values will be maintained, though it may look a little different.
Kingswood's commitment to honouring the MEC ethos through their Canadian affiliate and the solid financial footing from this transaction gives us tremendous confidence in the future. The Kingswood team, and the incoming CEO, Canadian and longtime MEC member Eric Claus, are very optimistic about MEC’s future. That optimism was at the heart of the board’s decision to enter into this agreement. For more information see: www.alvarezandmarsal.com/MEC.
Guided by the last 50 years, we look forward to MEC’s continued service to communities across Canada enabling everyone to lead an active outdoor lifestyle.
Thank you for your commitment to MEC,
Judi Richardson
Chair of the Board of Directors
Last edited by: Brocklanders on Sept. 18, 2020, 10:24 p.m., edited 2 times in total.
But didn't it get bought out by an American company so it's not closing now? It just won't have tap on its credit card machines and it's prices will fluctuate with exchange rate
Really what's happening.
This new company has bought MEC for a fraction of what the real estate is worth. Run it into the ground, then sell the real estate off for profit. MEC will be no more whatsoever.
Posted by: syncro
Posted by: XXX_er
I mean whom would start an MEC today ?
People with an ethical view of retailing.
where would one find these unicorn retailers today ? The original MEC founders didnt get into it for money they got into it for the gear, along the way we ended up with some people running it into the ground
Some updates on MEC
People have raised $65k and counting to help fund a legal challenge which includes calling for a special general meeting so members can decide the future of MEC.
To sign the call for a SGM you can do it here:
Posted by: syncro
Some updates on MEC
People have raised $65k and counting to help fund a legal challenge which includes calling for a special general meeting so members can decide the future of MEC.
To sign the call for a SGM you can do it here:
Savemec? What are we attempting to save at this point? It a 'co-op' in name only at this point (when was the last time you received a MEC Dividend payment?). MEC did say this was a last ditch resort to prevent closing, so Im not sure what value this website/petition would have.
This could also be seen as an opportunity to bring in a new board that wants to return to the roots of co-op retailing and continue to support environmental and recreational initiatives. Bigger picture.
Last edited by: tungsten on Sept. 30, 2020, 7:19 p.m., edited 1 time in total.
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Thankfully it isnt being delayed.
https://www.cbc.ca/news/canada/british-columbia/mec-sale-to-proceed-1.5748060
Posted by: shoreboy
Thankfully it isnt being delayed.
https://www.cbc.ca/news/canada/british-columbia/mec-sale-to-proceed-1.5748060
I don't get this sort of attitude, of writing something off because it isn't working as it should instead of trying to fix it or finding a way to keep it going.
I am not 'writing it off'. I just don't see the scenario where MEC gets salvaged into something it used to be given how far it has strayed from its initial premise. At least this way, most of the workforce will get to keep their jobs (for now).
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