A Manitoba First Nations business success story is showing signs of financial trouble, as one of its companies, Arctic Beverages Ltd., is seeking creditor protection.
Arctic Beverages, which bottles and distributes PepsiCo. and other products, has taken the first step to avoid bankruptcy, according to documents obtained by CBC News.
The Winnipeg-based company filed a notice of intention last month to make a proposal to its creditors under the Bankruptcy and Insolvency Act.
The documents, which were filed in late-March, indicate that Arctic Beverages owes more than $26.2 million in total to creditors and the company says it cannot meet its financial obligations at this time.
Of that amount, $11.5 million is owed to the Tribal Council Investment Group of Manitoba Ltd., which owns Arctic Beverages. It owes Pepsi about $1.2 million, according to the documents.
"This was a necessary step initiated to ensure the ongoing viability of the ABL business," a letter from the company to its creditors, dated March 25, states in part.
"We also want to let our stakeholders know that ABL and its sister company, Arctic Beverages Sask Limited, have entered into a sale process aimed at ensuring stable long term ownership is put in place and for this purpose, they have engaged PricewaterhouseCoopers Corporate Finance to manage the sale process."
The letter adds that the companies have negotiated an "interim financing agreement to ensure ongoing purchases and financial commitments can be met as we move forward."
Arctic Beverages distributes Pepsi, Frito Lay, Parmalat, Nestle ice cream and Canada Bread products to northern Manitoba and Saskatchewan as well as northwestern Ontario and Nunavut.
It's wholly owned by the Tribal Councils Investment Group, making it the only Pepsi bottler in the world that is owned by First Nations, according to the group's website.
Officials with Arctic Beverages declined to comment and calls to the investment group were not returned on Monday.