Mera Cannabis: the lender credit-bids $75 million and takes the company

In late July 2025 Mera Cannabis Corp. made its first sale into the European Union, 310 kilograms of cannabis to a customer in Germany for approximately $1 million. That month German regulators inspected Mera's plant at 27 Sparling Road in St. Thomas, Ontario, and a leased production facility on Harwill Road, as part of renewing the group's EU good manufacturing practices certification, and EU GMP representatives identified "minor observations" and "major observations." The certificate was not renewed for Sparling or issued for Harwill. Given the lost certification, the buyer rejected the cannabis, which went into storage in Germany, and on or about September 2 Mera refunded the buyer's deposit of approximately $495,000. Until it lost the certificate, the group "was one of approximately 18 cannabis producers in Canada who were certified to export cannabis to the EU." That is the sworn account of Darren Karasiuk, a consultant Mera's senior lender had retained in June 2025, per the Affidavit of Darren Karasiuk, Oct. 17, 2025, paras. 1, 15–16, 19, 24.

The lender was Aggregated Investments Inc. of London, Ontario. Under a convertible debenture amended and restated on March 2, 2022, and amended repeatedly since, Mera owed it $87,652,818.44 at August 31, 2025, with interest accruing at approximately $1 million a month. The debt was secured on the property of all six group companies and by a mortgage on Sparling raised in steps to $29 million, and guaranteed by the other five companies, per the Affidavit of Jerry Drennan, Oct. 17, 2025, paras. 5, 9–14, 18–26, and by Zubin Jasavala, whom the monitor calls "the principal and former directing mind of the Mera Group," per the Fourth Report of the Monitor, Apr. 1, 2026, para. 20.

On October 23, 2025, Justice Cavanagh of the Ontario Superior Court of Justice (Commercial List) granted Aggregated an initial order under the Companies' Creditors Arrangement Act over Mera and five subsidiaries, with their consent. His endorsement records that the group, with approximately 180 employees, had not made its required payments to Aggregated since June 2023 and over the previous 12 months had run a quarterly deficit of approximately $1.9 million before its repayment obligations to Aggregated, which had demanded payment on September 24 and "has lost all confidence in the Mera Group's management." He appointed Ernst & Young Inc. as monitor and Karasiuk as chief restructuring officer, with powers the judge called analogous to "super monitor" powers, given to Karasiuk because EY "does not have the necessary approvals to act as a 'responsible person' under the relevant cannabis regulations during this proceeding." He approved $400,000 of interim financing from Aggregated, per the Endorsement of Cavanagh J., Oct. 23, 2025, paras. 1–3, 5, 13, 16, 22, 28, 33.

The only final bid

The interim facility rose to $2.6 million on November 3 and to $7.8 million on December 5, when the court also approved a retention plan for key employees and a sale and investment solicitation process, per the Fifth Report of the Monitor, Apr. 27, 2026, paras. 3–5. On January 22 the Ontario Cannabis Store, which the monitor described as Mera's largest buyer of recreational products and which had warned Mera in December that it might alter its terms of business and had since begun doing so, asked for $2.6 million in security against product it might return, per the Third Report, Feb. 4, 2026, paras. 18–25. On February 11 Justice Steele authorized Aggregated to arrange a letter of credit in that amount, to count as a DIP advance, per the Letter of Credit Order, Feb. 11, 2026, paras. 3–5.

Aggregated put its preference on the record before the process opened. "For the right consideration from the third party, the Applicant would prefer to realize upon its loans to the Mera Group rather than owning the Businesses," its chief financial officer, Jerry Drennan, swore on December 1. The process let Aggregated withdraw or modify its qualified bid in favour of a lower third-party offer; if it did, Jasavala's liability on his guarantee would be capped at what it would have been had Aggregated's original bid closed, per the Affidavit of Jerry Drennan, Dec. 1, 2025, paras. 38–39. The monitor expected Aggregated's secured claims under the debenture and the DIP to exceed $90 million by the end of the forecast period in May 2026, per the Second Report, Dec. 2, 2025, paras. 23, 52.

From about January 7, 2026 the monitor canvassed approximately 107 known interested parties across North America; twelve signed non-disclosure agreements and eleven entered the data room. Aggregated declared its intention to bid on January 30. By the February 13 deadline four letters of intent had arrived: Aggregated's, for substantially all of the group, and three for parts of it, namely CannaWay Clinics' virtual clinical business, Greenleaf's extraction business with Countryside's outdoor cultivation business and certain brands, and Vivariant's laboratory assets. Aggregated's bid was accepted as qualified automatically. Of the others only the clinic bid qualified, and on March 10 that bidder said it would not make a final bid. At Aggregated's requests the monitor extended the March 2 bid deadline twice, eighteen days in all, which it acknowledged exceeded the process's seven-day cap on extensions without court approval, and asked the court to approve them after the fact. On March 20 it received a final bid from Aggregated, "the only remaining bidder for the core business of the Mera Group," per the Fourth Report, paras. 26–38. Its consideration was, in the monitor's factum, "the only offer and therefore the greatest price achieved via the Court-approved SISP," per the Factum of the Monitor, Apr. 6, 2026, paras. 17, 19.

What the credit bid bought

The subscription agreement signed on March 31 set the price as a credit bid of $75,000,000 against the DIP and the secured debenture, cash for a cure-costs reserve and a wind-down amount, and the liabilities Aggregated would cause the group to keep. Mera would issue Aggregated new shares amounting to 100% of its equity, and the old shares would be cancelled without consideration. The excluded liabilities, bound for a new company, include the secured debt left after the credit bid, taxes owing or accrued before the initial order, claims under excluded contracts and liabilities for terminated employees. Schedule B, the liabilities the purchaser designated to stay, names one: Aggregated's charge on 27 Sparling Road, registered in November 2021 and amended three times, in the principal amount of $29,000,000. Aggregated would take on all employees except any it named, and fund the cure costs scheduled for retained contracts, per the Subscription Agreement, Mar. 31, 2026, ss. 1.1, 2.1–2.4, 5.7, 9.3, Sch. B (Supplement, App. A).

The monitor's case for the structure turned on licences. The companies held Health Canada cannabis licences, drug establishment licences and CRA excise licences, certain of which, in a conventional asset sale, "may be cumbersome or time-consuming to transfer," with risks and delays the debtors lacked the liquidity to withstand. Aggregated had told the monitor it would not consider a plan of arrangement, for the added cost, or an asset purchase, for uncertainty over the licences; and, the monitor understood from Aggregated, the structure "enables the Purchased Entities to preserve certain tax attributes that would otherwise be lost in an asset sale." The monitor expected Aggregated to suffer a shortfall even on closing and a bankruptcy to realize materially less, and thought recoveries for other creditors unlikely even in an asset sale. Its counsel, Bennett Jones LLP, opined that Aggregated's security was good, valid and enforceable, subject to standard assumptions and qualifications, per the Fourth Report, paras. 18, 46(a)–(b), 47–48, 51–54.