Seafood Billionaire John Risley's Firm Confronts Massive Debt and Legal Challenges Amid Ownership Transition
An investment firm headed by seafood billionaire John Risley is grappling with debts exceeding US$776 million alongside tens of millions in legal claims as it seeks protection from creditors and prepares for an ownership transfer, according to recent court filings. Halifax-based CFFI Ventures Inc. has secured a preliminary court order granting temporary relief from creditor actions while it works to restructure hundreds of millions in secured debt and other financial obligations.
Court Protection and Restructuring Efforts
The interim order imposes a stay of proceedings until a follow-up hearing scheduled for February 27, when the company is expected to request an extension of its asset protection and approval for subsequent restructuring steps. CFFI filed for this order without notifying creditors—an "ex parte" application—arguing that advance notice could trigger enforcement actions that might derail its restructuring efforts.
In a detailed 493-page affidavit, CFFI chief financial officer Brittany Bartlett emphasized that temporary relief was critical to stabilize operations. She stated that the company "does not believe its assets can be monetized in the near term" and that current values are insufficient to cover total liabilities. This stability is necessary to ensure CFFI can present a comprehensive plan of arrangement to its creditors through an orderly and fair process.
Proposed Asset Transfer and Financial Liabilities
Under the proposed restructuring plan, most of CFFI's assets would be transferred to a new entity called AcquireCo, which would be controlled by HPS Investment Partners LLC and other secured creditors through a holding company named New Holdco. HPS's secured claim alone, stemming from a note purchase and guarantee agreement dating back to 2017, totals approximately US$777 million, not including accrued interest, according to court documents.
CFFI also disclosed roughly $371 million in unsecured liabilities, which includes more than $331 million in disputed Canada Revenue Agency tax assessments. The company's assets include significant stakes in skincare brand SkinFix, marine services company Horizon Maritime Service Ltd., and an interest in a proposed wind-powered hydrogen project in Newfoundland, along with partial ownership of several other ventures.
Leadership Perspective and Judicial Review
"Change is inevitable and I believe this is the right path for the future," said Risley, who serves as CFFI's chair and chief executive, in a recent release. "I have a higher tolerance for risk than most, which has driven the success and some setbacks experienced since founding Clearwater Fine Foods Inc. (CFFI's predecessor) in 2003."
Justice John Keith acknowledged the complexity of the plan of arrangement, noting it covers all creditors—including "convenience" or unsecured small creditors—and involves substantial assets and debts, similar to a formal insolvency proceeding. "Complexity; urgency; high stakes in terms of value and debt; and issues that border on insolvency are certainly not uncommon in these types of plans of arrangement," he remarked in his decision to grant CFFI temporary protection from creditors.
CFFI has filed a formal plan in Nova Scotia Supreme Court to facilitate the asset transfer as part of its debt restructuring strategy aimed at restoring financial stability. A judge is expected to decide in April whether to approve this plan, which could mark a significant turning point for the firm amidst its current financial and legal challenges.
