British Columbia Discovery Fund Inc. (formerly British Columbia Discovery Fund (VCC) Inc.) Provides Update on Liquidation Proceedings
02 Julio 2024 - 10:00AM
British Columbia Discovery Fund Inc., (formerly
British Columbia Discovery Fund (VCC) Inc.) (the
“
Fund”), by MNP Ltd. (formerly The Bowra Group
Inc.) in its capacity as liquidator of the Fund (the
“
Liquidator”), provides the following update as to
the liquidation proceedings of the Fund.
Pricing Net Asset Value per Class A Common Share
is $0.19 as at May 31, 2024 compared to $0.20 as at February 29,
2024. The principal reason for this change is expenses incurred in
the liquidation.
The Liquidator has now sold all of the Fund’s
investments in publicly traded investments and made a distribution
to shareholders of $.52 per share on June 19, 2023. Further details
of the sale of the Fund’s publicly traded investments and
distribution to shareholders are contained in earlier press
releases.
The Fund’s remaining investments are shares in
illiquid private companies.
The following is an update of the Fund’s
remaining portfolio companies and the Liquidator’s activities:
- Phemi Systems Corporation
(“Phemi”) – Phemi is a technology company which
provides data management, analysis, privacy, and security for
healthcare based in Vancouver, B.C.Since the last press release,
the Liquidator has not identified any new material events that
would impact the Fund’s investment in Phemi.Further updates and
information about Phemi can be found at: www.phemi.com.The
Liquidator is continuing to monitor Phemi and review any potential
opportunities for liquidity events while assessing the possibility
of a forced liquidation sale or distribution in kind pursuant to
its mandate.The Liquidator notes it has revised the value of Phemi
used in calculating Pricing Net Asset Value to reflect a
liquidation value.The Liquidator may further revise the value of
Phemi as the Liquidator further assesses the possibility of a sale
or distribution in kind.
- 3760073 Canada Corp. (formerly Navarik Corp.)
(“Navarik”) – Navarik is a technology company
providing software and data solutions for cargo and shipping of
petroleum products based in Vancouver, B.C. Navarik sold all of its
assets to Vela Software Group (“Vela”) in
September 2020. The Fund’s current interest in Navarik is limited
to future distributions Navarik may make to its shareholders
pursuant to the transaction with Vela.Navarik announced on June 14,
2024 that Vela met the EBITDA threshold for fiscal 2023 and there
will be a final payout for the Fund from the Vela transaction in
August 2024, subject to shareholder approval.The payout for fiscal
2023, if approved by shareholders, represents the final payment
pursuant to the Vela transaction and Navarik will be wound down
after the final payment.
- MTI Limited Partnership (acquired as a result
of the sale of Mobidia Technology Inc.) (“MTI LP”)
– Mobidia was a Fund portfolio company that was sold to Data.ai
Inc. (formerly App Annie Inc.) in 2015. The Fund’s current interest
in MTI LP is limited to its respective interest in Data.ai Inc.
shares held by MTI LP exchanged in the sale of Mobidia
transaction.Since the last press release, Data.ai Inc. has
announced that it has been acquired by Sensor Tower for terms not
publicly announced.The Liquidator is continuing to monitor MTI LP
and seeking further details on the Data.ai Inc. transaction terms
and its impact for the Fund.Management of MTI LP have indicated
they are currently exploring options for the receipt and
distribution of the proceeds of the Data.ai Inc. transaction then
wind up of MTI LP. The payment of proceeds to shareholders,
including the Funds entitlement to any payment, is expected to
occur in 2024 however the timeline and amount payable to the Fund
is still subject to final calculation and approval of MTI LP’s
unitholders.The Liquidator will provide further information when
available subject to any confidentiality terms which may be
required.The Liquidator will continue to review any opportunities
to liquidate its position in MTI LP that may arise due to the
transaction.The Liquidator may further revise the value of MTI LP
as the Liquidator further assesses the details of the
transaction.
The Fund will continue to realize on its
investments in portfolio companies through participation in
liquidity events when possible pursuant to its liquidation mandate
and to address remaining outstanding matters relating to its
liquidation, including tax matters.
In addition, the Liquidator is now also
considering forced sales and distributions in kind where
appropriate (and is weighing that against the ongoing costs of
maintaining the portfolio and continuing to wait for liquidity
events).
In accordance with the steps for the voluntary
liquidation as approved by shareholders in the Information Circular
dated May 22, 2020 and approved by the shareholders of the Fund on
June 24, 2020 the Liquidator notes that if the liquidation process
extends beyond two years from December 1, 2020 the effective date
of the liquidation, the Liquidator retains the discretion to
accelerate dissolution of the fund through a forced sale or
distribution in kind of the residual portfolio assets.
At this time, the Fund is not aware of the
anticipated date of any distribution, and the Fund has not yet
determined a date for the dissolution of the Fund.
Updates and materials related to the Fund’s
liquidation proceedings can be found on the Liquidator’s website
at: www.bowragroup.com. The Liquidator will continue to make
available on its website additional information and updates on the
status of the Fund’s liquidation proceedings and disseminate a news
release on at least a quarterly basis.
Risk Factors and Forward-Looking
Information
This news release may include statements about
expected future events and/or financial results that are
forward-looking in nature and subject to risks and uncertainties.
The issuer cautions that actual performance will be affected by a
number of factors, many of which are beyond the control of the
Liquidator. Certain risks include but are not limited to those
described in the paragraphs below.
The Fund cannot assure its shareholders of the
timing or amount of any liquidation distributions. The remaining
portfolio assets of the Fund consist of illiquid securities of
private entities which may be liquidated either opportunistically
upon the occurrence of liquidity events in the underlying portfolio
companies or by proactively liquidating pursuant to forced sales.
The timing of liquidity events is uncertain and the amount of
distributions resulting from such events depends on the proceeds
realized from such dispositions which in turn will depend on the
many factors that impact the value of the portfolio companies.
The Fund may have lower realizations pursuant to
forced sales and distributions in kind than it would if it had
waited for subsequent liquidity events, but nonetheless, such
forced sales or distributions in kind may also reduce ongoing
administrative costs of the Fund. The Fund may be prevented from
making distributions in kind by the constating documents of private
companies or by the provisions of applicable shareholders’
agreements, if any, each of which may contain legal and technical
limitations or prohibitions on the ability of the Fund to
distribute shares in kind to shareholders.
The Fund will continue to incur expenses that
will reduce the value of any liquidation distributions; if the Fund
fails to retain sufficient funds to pay the expenses and
liabilities actually owed to the Fund’s creditors, each shareholder
receiving liquidation distributions could be held liable for
payment to the Fund’s creditors, of his, her or its pro rata share
of any shortfall, up to the amount actually distributed to each
shareholder; if, at the time of a distribution to shareholders, the
Fund cannot pass statutory solvency tests, the distribution may be
prohibited; there are no assurances that the Liquidator will
achieve the same financial results that management might achieve if
it had continued as the manager of the Fund; the tax treatment of
liquidation distributions may vary from shareholder to shareholder,
and shareholders should consult their own tax advisors; and the
Class A Shares may, in certain circumstances, cease to be
‘‘qualified investments’’ for “registered plans” for the purposes
of the Income Tax Act (Canada).
See “Risk Factors” in the information circular
of the Fund dated May 22, 2020 and available on www.sedar.com.
Additional Information
Additional information relating to the Fund’s
liquidation and associated matters is contained in the information
circular of the Fund dated May 22, 2020, which is available on
SEDAR at www.sedar.com.
MNP Ltd. Is one of the largest corporate
insolvency practices in Canada and a subsidiary of national
professional services firm MNP LLP. The Bowra Group merged with MNP
Ltd. effective December 1, 2022. MNP Ltd. (formerly The Bowra Group
Inc.) will continue to act as a Liquidator of the Fund and there
will be no changes unless otherwise noted.
Further information about MNP Ltd. (formerly The
Bowra Group Inc.) and updates to shareholders and information on
the liquidation of the Fund can be found at www.bowragroup.com.
Gordon Brown MNP Ltd. (formerly The Bowra Group
Inc.)Suite 1630 – 609 Granville Street, Vancouver, B.C. V7Y
1G5Phone: 604-689-8939Email : insolvencyinfoTBG@mnp.ca