Laurentian University finalizes a real estate deal to repay creditors, marking a key step in closing its four-year insolvency process.
Laurentian University Finalizes Creditor Payments
Closing Chapter on Insolvency
Laurentian University is preparing to complete payments to its final group of creditors, nearly four-and-a-half years after declaring insolvency. The payments follow a major real estate deal with Infrastructure Ontario, ensuring that unsecured creditors will receive the maximum 24% compensation agreed upon under a court-approved plan.
How Payments Were Secured
To generate the required funds, Laurentian sold six properties, including the Northern Ontario School of Medicine University, to the province for $53.5 million. Last week, the university and Infrastructure Ontario finalized the agreement, which allows Laurentian to lease back three properties, including the East Residence and Living with Lakes Centre.
Impact on Staff and Faculty
Those eligible for payment include 117 faculty, 42 staff, and 37 non-union employees who lost their jobs during the insolvency process. While faculty association president Fabrice Colin welcomed the payout, he also noted the lingering hardship caused by the Companies’ Creditors Arrangement Act (CCAA). Former professor David Leadbeater criticized the deal, saying many voted under pressure to avoid the university’s closure.
University’s Outlook
Laurentian president Lynn Wells said the agreement signals a turning point, stressing that students will not see disruptions in their studies. She described the sale as a “sign of strength” and a move that positions the university for growth. Payments to creditors are scheduled to be completed by November 29.
Broader Lessons in Higher Education
Financial experts, including former Carleton University CFO Michel Piché, described the real estate sale as a practical resolution to a difficult financial crisis. However, he cautioned that similar pressures—such as tuition freezes and limits on international students—continue to challenge universities across Canada. He emphasized that Laurentian’s recovery will depend on sustainable management, noting the school has begun hiring faculty again as part of its rebuilding process.
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