Aldo breached some conditions of $10 million grant

Aldo failed to comply with some of the conditions attached to a $10 million grant obtained in 2014, which forced the Ministry of the Economy to impose penalties totaling $3 million on him, Le Journal learned.

Aldo breached some conditions of $10 million grant

Aldo failed to comply with some of the conditions attached to a $10 million grant obtained in 2014, which forced the Ministry of the Economy to impose penalties totaling $3 million on him, Le Journal learned.

• Read also: Aldo's setbacks cost Quebec taxpayers $37.2 million

"It is not possible for us to communicate in detail the reasons that led to these penalties, due to the confidentiality of this information," Dominik Boudreault Lapierre, spokesperson for Investissement Québec, said yesterday.

We know, however, that at the time of receiving the grant, the shoe giant had committed to creating at least 400 jobs at its Montreal headquarters from 2014 to 2019.

In 2015, Aldo laid off dozens of employees in Quebec and Asia in an effort to streamline its organizational structure.

Aldo paid the government penalties of nearly $365,000 in 2017-18 and about $372,000 in 2018-19, Boudreault Lapierre said.

At the time of sheltering itself from its creditors due to its insolvency situation, in May 2020, Aldo still owed $2.27 million in penalties to the Ministry of the Economy.

6% refund

As this claim is unsecured, it has been treated with those held by ordinary creditors of Aldo. Under a plan of arrangement approved by the Superior Court last month, the company will repay approximately 6% of the value of those claims.

That means Quebec only recovered $136,200 of the $2.27 million penalties Aldo owed them.

These losses of $2.13 million are in addition to those of $34.5 million related to a loan of $40 million, also granted in 2014, for a total of $36.6 million.

The $40 million loan was secured by computer software and hardware, but the accounting estimate retained by the Superior Court concluded that their value had diminished, in the context of Aldo's financial difficulties.

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