Sep 18, 2020
MEC Update — September 17th
On Sep 14th, it was announced that Mountain Equipment Co-operative would be acquired by a private company through a CCAA proceeding and would cease to be a co-operative. Since the announcement was made, over 84,000 members from across the company have expressed a desire to find a way to keep MEC running as a co-operative organization.
Petition here — Please share and sign:
On September 16th, I shared some rough calculations to try to estimate the order-of-magnitude of investment that would be required from members to re-capitalize the co-op as an alternative to selling it to a private entity. Based on those estimates, it looked like that approach would be within the realm of possibility.
Anders Ourom has now shared a post which explains a path forward. A lawyer will hopefully be able to attend the Comeback Hearing on Sep 24th to argue that members should be given a chance to recapitalize the co-op. That argument will be stronger if the lawyer has a trust account with a meaningful amount of money that is committed to the purpose of buying investment shares (it would be returned if the bid failed.)
The folks organizing the movement have some logistics to sort out in the next few days to find a lawyer and organize the logistics of fundraising efforts. I understand that this is a top priority for them. No immediate action is needed from any of us right now beyond sharing the petition, writing to our elected representatives, and continuing to raise awareness. We will all be on the lookout for the next call-to-action from the organizers.
I do want to take a minute to talk about the importance of remaining positive. It is my belief that a successful alternative bid will require a consortium that involves members, a traditional lender (bank, credit union, etc.) and a bridge loan from the provincial or federal governments. The chances of successfully assembling that type of a consortium will be much higher if the community is a beacon of hope instead of becoming an unruly mob.
My suggestions:
1) Focus on saving the co-op, not on stopping the sale
Stopping the sale is a negative goal and it’s not productive. If the sale is stopped without an alternative, the co-op will proceed to an even worse outcome in bankruptcy. Instead, members are trying to create a better outcome by finding a solution that allows MEC to continue to operate as a co-operative.
2) Be critical of the decision and the process without being critical of the character of the individuals
I am very critical of the decision to proceed to a sale without member consultation and at the regulatory framework that would allow this situation to occur. I am not mad at the individuals on the board or the management team and I am not questioning their motives or competencies. Last November, I was invited by Judi Richardson, Chair of the Board, to the Head Office for a coffee. I left the meeting feeling that she is very intelligent and cares a lot about the co-op. I would say the same about every other active member of the Board that I have had the opportunity to meet. Not surprisingly, we had differences of opinion on policies and priorities. After that meeting, I noted that: “Nothing bad ever happens when people who disagree sit down and share their perspectives.” I wish that could happen today but unfortunately the CCAA proceedings make that almost impossible. I am sure that the Board and management team are as disappointed about the current situation as we are.
3) Plot a path towards creation, not destruction
With so many people coming together who are passionate about the outdoors and democratic organizations, I am excited about the possibilities. The most immediate goal is to save MEC. However, the new connections that are being formed may result in new co-ops being founded, increased lobbying for changes to the the Cooperative Association Act and an injection of energy into a variety of nature/outdoor organizations in Canada.
On the other hand, I am not criticizing the group that plans to buy and run MEC. They have presented the best option to the Board (so far,) for being able to maintain the business for the benefit of the employees and they have not yet had a chance to show how they will run the business.
Cheers,
Steve
stevejoneshikes@gmail.com
