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Nexii Building Solutions Inc., a green building startup that boasted a $2-billion valuation less than two years ago, has been granted protection from creditors as it seeks a buyer to rescue the money-losing operation.

The Vancouver-based company said it owes its creditors more than $109-million and faces “significant liquidity constraints,” according to the petition it filed last week with the Supreme Court of British Columbia. It is unable to pay its debts after a costly expansion in the United States, notably a new manufacturing plant in Pennsylvania.

The company makes concrete-like panels for residential and commercial buildings using a proprietary material, developed in Moose Jaw, Sask., that it says is less carbon-intensive and creates less waste. Among its executives was former Vancouver mayor Gregor Robertson, though he left the company in November, according to his Linked In profile. Two years ago the company made headlines when it formed a partnership to build a plant with actor Michael Keaton, known for such films as Birdman and Beetlejuice.

After striking a deal for US$4.3-million in interim financing with its senior lenders, Nexii is now searching for a buyer for the company and its subsidiaries. Much of the business’s value is in building contracts, according to an affidavit from its acting chief executive officer, William Tucker.

Its lenders, which include Powerscourt Investments, Trinity Capital Inc. and Horizon Technology Finance Corp., are owed US$80-million and were not prepared to advance any more funds without an agreement to pursue a sale, Mr. Tucker said.

“Although Nexii has significant potential value, the entities have few tangible assets and a tenuous financial position, as a result of which there is a limited pool of potential lenders in the context of a restructuring proceeding,” Mr. Tucker wrote.

He has led the company since former CEO Stephen Sidwell stepped down in October. Three other senior executives have left the company since August.

Nexii’s downfall has been quick, as had its ascent to unicorn status. In the summer of 2022, it said it had completed an equity financing that implied a market value of $2-billion, nearly double its worth a year earlier.

That $45-million deal was aimed at speeding up the company’s growth to meet demand for sustainable building solutions. Expansion plans included marketing the proprietary technology worldwide. Its customers include such companies as Starbucks Corp., Popeyes Louisiana Kitchen Inc., Marriott International Inc., Walmart Inc. and Chase Bank. It has manufacturing facilities in Moose Jaw and Squamish, B.C.

In 2021 the company announced that Mr. Keaton had taken an ownership stake and was planning to take “an active role” in a new manufacturing facility in his hometown of Pittsburgh. The plant was to be built by Nexii and Craig Rippole of Trinity Commercial Development, creating 300 jobs, according to the initial announcement.

Mr. Tucker said the company’s rapid expansion started that year, including a licensing agreement for a facility in Hazleton, in central Pennsylvania. The counterparty in that deal did not pay the initial licensing fee of US$5-million and was unable to perform its duties because of a lack of working capital, he said. Nexii kept working on the project for more than a year, at significant cost, to protect its brand, he added.

“Following this expansion effort, Nexii’s business grew, but not to the extent anticipated, and the costs were high relative to revenue,” he wrote in his affidavit. “The group was also unable to service its obligations under the loan agreement.”

He said the company has re-engineered its main product, Nexiite, over the past 24 months to reduce costs and make it more competitive, but Nexii has consumed large amounts of capital over that time.

The company should be an attractive acquisition target because its technology has value in a market that places a premium on sustainable building practices, Mr. Tucker said.

The court has appointed KSV Restructuring as the monitor for the case.

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