Local furniture maker granted loan to stay afloat
A Dartmouth furniture-maker that employs 220 people has been granted a $1-million loan to keep it in business.
Scanwood Canada Ltd. is in bankruptcy protection and needed the loan by next week to continue operating.
More than 200 Scanwood employees make nearly a million dressers each year for IKEA, the plant's only customer.
The company owes creditors $12 million dollars.
Scanwood is in the middle of a $6-million modernization to make it more efficient.
Nova Scotia taxpayers also have something at stake; the provincial government lent Scanwood $4.5 million last year to help pay for the modernization.
The Royal Bank and Business Development Bank were opposed to Scanwood's request to borrow more money.
Company president Bo Thorn said he's relieved the court has allowed his company to stay in business.
"Today was a victory, we are happy with the ruling. Now we can get on," said Thorn. "We are trying to produce as much as we can. We are constricted by the material we have on hand and our cash flow, this is hard on our people and requires patience on our customer, IKEA's behalf."
Thorn said the company has continued to lay off people since last fall when it had 250 employees.
Next week Scanwood will ask the court for more time to come up with a plan to repay its outstanding debts.