Financially troubled Diversified Industries Ltd. (TSXV: DVS) has announced plans to file a proposal to its creditors under the Bankruptcy and Insolvency Act.
The company, which is headquartered in Red Deer, said in a news release on Wednesday that it can no longer meet its financial commitments.
Previously, it had reported that debenture holders 570108 BC Ltd. and Tocher Holdings Ltd. had claimed defaults and requested repayment of principal and interest totalling approximately $670,000.
Diversified said it intends to appoint G. Powroznik Group Inc. of G-Force Group of Vancouver as its trustee, and that it has entered into discussions with its major creditors about a potential restructuring.
Diversified develops, manufactures and markets specialty chemicals and bulk commodity chemicals.
In 2007, it acquired a controlling interest of CFR Chemicals Inc. of Red Deer.
Diversified, which had been based in Sidney, B.C., subsequently moved its head office to Red Deer.
CFR Chemicals, which was founded in 1996, operated at facilities in Red Deer and west of Sylvan Lake, as well as in High Level, Grande Prairie and Viking.
Earlier this month, Diversified announced that Darren Lamothe, its president and CEO, had been relieved of those positions as well as his roles of director, president and CEO of CFR Chemicals.