Nothing is going well with the finances of Cinémas Guzzo. CIBC and the group’s private lenders are demanding more than $60 million from it and are taking steps to put the group into bankruptcy. CEO Vincent Guzzo says he will save his little big screen empire thanks to imminent financing.
The group’s largest creditor, CIBC, is claiming more than 37 million, according to the sums included in its mortgage appeal, invoking the Bankruptcy and Insolvency Law. In the document, the Bank deplores Guzzo’s “negligent management” and asserts that the largest independent owner of theaters in Quebec has accumulated 1.4 million in unpaid property taxes.
The Equitable Bank is claiming nearly 16 million from two companies in the group, which it considers “insolvent” in its notices filed with the land register. Private lenders from Quebec, Q-12 Capital and Q-8 Capital, are demanding nearly 10 million from the same companies.
The City of Montreal is not left out. In her own appeal, she claims unpaid taxes of $216,053 at the Méga-Plex Lacordaire, in the borough of Saint-Léonard.
Rescue plan
On the phone with The PressVincent Guzzo assures that he is on the verge of finding a new lender to replace CIBC and repay all his debts, within a few days.
PHOTO FROM CBC SITE
The photo of Vincent Guzzo on the show’s website Dragons’ Denin which he participated for six seasons, until last April
“The people who are trying to get me out of this problem are among the richest Quebec families,” says the businessman, former participant in the show Dragons’ Den at CBC, where investors bet – or not – on entrepreneurs.
The big screen and buttered popcorn mogul explains that CIBC recalled his loans after the charges filed against him in June 2023 for criminal harassment and non-compliance with conditions. “In August, two months after my arrest, they sent me a letter saying that I had to leave [comme client de la banque] because they were tired of the relationship. »
The public prosecutor finally withdrew the charges against him in November. “When the charges were dropped, they wondered how to get out of there,” says Vincent Guzzo.
He deplores the attitude of CIBC, which dumped him after its liquidity problems caused by the pandemic and the Hollywood screenwriters’ strike.
“What they are doing is really abusive, considering that it has been my bank for 22 years,” he adds.
The 37 million that CIBC is requesting from its group includes, according to him, nearly 9 million in “COVID loans”, financing guaranteed by the government to help businesses get through the pandemic.
“Account overdrawn”
Contacted by The PressCIBC did not comment. In her appeal, she addresses a series of criticisms to Guzzo, demonstrating, according to her, that the group is not respecting the commitments made when signing its loans.
To illustrate its “negligent management”, the Bank mentions in particular that Guzzo’s account “was overdrawn daily for a prolonged period”.
The group would also have refused to allow CIBC to set up a reserve to pay its property taxes and would have provided “inadequate reports”, without showing it annual financial statements since 2021, contrary to what the loan agreement requires.
Vincent Guzzo dismisses these criticisms and points out that the Bank “is taking advantage of a property that is worth much more”.
PHOTO ALAIN ROBERGE, THE PRESS
When our photographer visited, the Méga-Centre Guzzo Pont-Viau in Laval showed significant signs of deterioration.
The building that it threatens to seize, the Méga-Centre Pont-Viau in Laval, is worth less than 30 million according to the City, but the businessman assures that the Colliers firm has valued it at 81 million.
Vincent Guzzo adds that he is on the verge of resolving his other problems with Equitable Bank and Q-12/Q-8. These lenders notably took out guarantees on a vast piece of land belonging to his group, at the corner of highways 13 and 440 in Laval. “We are in the process of refinancing it,” he said. We will give them the money Monday, Tuesday…”
The property, the size of a dozen soccer fields, is worth 7 million according to the City of Laval. The businessman, however, claims to have received an offer of 57 million in 2022 from a data center company. The transaction reportedly failed due to power supply problems.
Bounced checks to lessors
Three owners of buildings that house Guzzo cinemas were already suing the group before these new actions, revealed The Press in March and July.
In total, these three lessors are demanding more than 14 million from the group headed by Vincent Guzzo.
In their proceedings, they all say they have received bad checks and are claiming millions in unpaid rent.
In the largest dispute in Saint-Jean-sur-Richelieu, the owners are also demanding reimbursement of 9 million paid to the Guzzo group for the development of a shopping center, alleging that it never completed the work.
To resolve this dispute, Vincent Guzzo ensures The Press that he is preparing to repurchase the property and that he has sufficient funds to do so. “It will be resolved within three weeks. »
The Guzzo Group in brief
- Origins: In 1974, Angelo Guzzo, Vincent’s father, acquired the Capri cinema, which he renamed Le Paradis.
- CEO: Vincent Guzzo
- Other shareholders: Angelo Guzzo, Rosetta Rubino-Guzzo
- Number of establishments: 10, all in the greater Montreal area, approximately 150 rooms
- Companies in other sectors of activity: Pizzeria Giulietta, Guzzo Construction Group