Shermag accepts purchase offer from Bermex

Deal to buy insolvent furniture maker awaits approval by Quebec court

Furniture Today Staff -- Furniture Today, August 3, 2009

MONTREAL — Shermag's board has accepted an offer for the insolvent furniture manufacturer's assets from fellow Quebec furniture maker Bermex, according to reports.

Terms of the deal were not immediately disclosed.

Bermex would purchase all of Shermag's shares and assume part of its debt, according to a Canada Press report. The Quebec Superior Court, which has been overseeing Shermag since it sought protection under the Company's Creditors Arrangement Act in May 2008, also would have to accept the purchase offer.

Earlier, the court approved a plan for the sale of furniture importer Shermag and its subsidiary, upholstery producer Jaymar Furniture, as ongoing businesses and for the sale of the company's non-core assets.

The non-core assets include 11 of its now-idled factories in Quebec and northern New Brunswick, two sawmills, equipment and remaining inventory from its once-domestically produced collections.

Included in Jaymar's package is its 150,000-square foot factory in Terrebonne, Quebec. The Shermag package includes its distribution centre in Victoriaville, Quebec, as well as its head office and research and development centre in Sherbrooke.