Provincial government offers to buy $53.5 M of Laurentian University real estate
Judge has agreed to extend creditor protection to Sept. 30
Laurentian University is receiving more financial help from the Ontario government.
In its latest motion as part of insolvency proceedings, the university's administration says the Ministry of Colleges and Universities has offered to purchase $53.5 million worth of Laurentian-owned land or buildings.
The university is conducting a real estate review and there have been fears that it could sell off the popular trail network surrounding the campus or the historic Bell Mansion, the current home of the Art Gallery of Sudbury.
Laurentian says this arrangement with the province would allow it to continue to use and occupy the land, or buildings purchased by the province, which would not be the case if the assets were sold to third parties.
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Laurentian has asked the province to put the buildings of the newly independent NOSM University at the top of the list, but has not specified any other priorities.
In his affidavit, President Robert Haché says the NOSM University occupies two buildings owned by Laurentian on the Sudbury campus.
"NOSM University occupies approximately 60 per cent of the Health Sciences Education Resource Centre ("HSERC") and the entirety of the Medical School Building (the "NOSM Building")," Haché said in his affidavit.
" LU (Laurentian University) has requested that MCU (Ministry of Colleges and Universities) consider the HSERC and the NOSM Building on a priority basis as part of the discussions and as conversations advance with respect to the province's purchase of identified real estate assets from LU."
All of the money will go to help the university settle with its creditors.
In addition, the province is replacing the $35 million dollar debtor-in-possession loan it gave to Laurentian with a longer term loan, the terms for which are still being discussed.
Dr. Sarita Verma, NOSM University's president and CEO, said she has not been privy to any discussions around the province's proposed purchase of Laurentian real estate.
"One of the awkward issues here is that there is an election underway and the decision makers are in election mode," Verma said. "It's likely that we won't know much until after June 2."
NOSM leases two buildings located on the Laurentian campus. In March the institution announced it would add 30 medical degree and 41 residency spots over the next five years.
To accommodate that growth, Verma said it would be ideal if NOSM University gained access to the land next to the two buildings it currently leases from Laurentian.
"I mean, we would love to be able to, with the expansion, expand our classroom size, because right now it can only accommodate a certain number of students," Verma said. "I mean there's no doubt we're going to further grow."
Verma added she remains optimistic that NOSM will be able to recover around $15 million in endowments that are tied up by Laurentian's insolvency proceedings.
Laurentian and its advisors have continued to negotiate with former federated partners, the University of Sudbury and Thorneloe University regarding the terms of their continued participation in the pension plan.
They have reached an agreement with the University of Sudbury but not Thorneloe.
Meantime, the court documents show there have been claims totalling $360 million made against the institution.
A judge has approved Laurentian's request to continue to operate under creditor protection, which began on Feb. 1, 2021, until Sept. 30.
It expects to return to court at the end of June to seek a meeting order with creditors, which would include the Companies' Creditors Arrangement Act (CCAA) plan of arrangement in response to claims.