The federal Competition Bureau in Canada is currently reviewing a potential merger between TGI Holding Inc. and MEC Mountain Equipment Company Ltd. This follows a period of financial difficulty for MEC, which previously filed for creditor protection and was acquired by Kingswood Capital Management in 2020.
MEC's sales have declined, falling to $382 million in 2023 from $451 million the previous year. A confidential presentation to potential bidders revealed the company's need for capital infusion to stabilize its operations. As of late June 2024, MEC had $89.2 million in debt and only $6.4 million in cash.
The details of TGI Holding Inc. and the potential deal's implications for MEC's stores remain unclear. MEC's spokesperson declined to comment. The Competition Bureau's review is ongoing, and its outcome will significantly impact MEC's future.
MEC currently operates 23 standalone locations and three shop-in-shop locations within Hudson's Bay stores. A new store is planned for Nanaimo, B.C. E-commerce accounts for 30% of MEC's sales.