Bridging Finance investor speaks out as PwC pushes for wind down
BNN Bloomberg
A group of Bridging Finance investors plan to make a last-ditch effort in an Ontario court Friday to allow them to have a greater say in the future of the troubled private debt lender rather than have its court-appointed receiver wind down the firm.
A group of Bridging Finance Inc. (BFI) investors plan to make a last-ditch effort in an Ontario court Friday to allow them to have a greater say in the future of the troubled private debt lender rather than have its court-appointed receiver wind down the firm.
A filing made by Lerners LLP Partner Domenico Magisano on behalf of “certain Bridging unit holders” on March 18 to the Superior Court of Justice outlines that the investor group believes there has been insufficient information given to them to go forward with a proposed wind-down of BFI’s assets by PricewaterhouseCoopers Inc. (PwC), which has been in control of BFI since the firm was rushed into receivership last year at the behest of the Ontario Securities Commission (OSC). PwC has indicated investors in BFI’s funds stand to lose more than $1 billion in a liquidation.
“To approve [PwC’s] recommendation at this time would be tantamount to granting [PwC] with a single source contract to liquidate the respondents’ loan portfolio without any evidence that this option was exposed to the market,” the filing states.
The filing was made during a court hearing last month when PwC proposed ending its attempt to sell the firm and instead liquidate the firm after identifying “significant issues” with many of its loans. PwC added that offers to buy BFI’s loan portfolio and other assets were too risky to warrant pursuing, and stated that it stands to earn up to $42.5 million in “professional fee” costs related to the wind down. Magisano said in an email that he represents eight people that have invested a total of $800,000 in BFI’s funds.
If the Ontario court approves a wind-down, it would mark an anti-climactic end for the lender whose executives, including former Chief Executive Officer David Sharpe, were accused of misappropriating millions of dollars from its investment funds, failing to disclose alleged payments made to Sharpe’s personal chequing account by an intermediary and improper dealings with two key clients, Sean McCoshen and Gary Ng.
None of the allegations have been tested or proven in court or before the OSC.
