Canadian drinks company Flow Beverage Corp., maker of Flow Water, has entered a support agreement with its foreclosing creditors to transfer ownership of the business and its assets, with plans for the old business to eventually be “wound-down” while maintaining co-packing operations.
NFS Leasing Canada Inc. and RI Flow LLC have agreed to take control of the bottled water brand and beverage co-packing business following a default on debt repayments last month. The deal is pending court approval by the Ontario Superior Court of Justice.
The lenders have agreed to provide an undisclosed sum of bridge financing to Flow in order to maintain operations during the restructuring transaction.
According to the announcement earlier this week, the support agreement comes after “an exhaustive strategic review conducted under the supervision of a special committee of independent directors, which considered all alternatives” to address Flow’s liquidity.
As part of the agreement, NFS Leasing Canada and RI Flow will jointly control Flow Beverage, likely through a new entity tentatively named “NewCo.”
It’s unclear exactly how the new ownership will impact the company and its staff, with the release noting only that NewCo will “offer employment to certain of Flow’s current employees.”
The deal does not cancel out other debts incurred by Flow to other firms and businesses.
However, the end result appears to be to shut down Flow following the completion of the transaction. The release notes that Flow “and its subsidiaries and their remaining assets and liabilities will be wound-down under the supervision of the receiver and the Court pursuant to proceedings commenced under the Bankruptcy and Insolvency Act [of Canada].”
According to Paul Dowdall, CFO and a member of the interim CEO group running Flow, “the brand will continue (as it is an asset) but entities will be wound down after completion of the foreclosure.”
In a full statement, Dowdall noted that while the foreclosure process “limits what we can share today,” he highlighted that “the process is designed to restore stability and position the business for continuity.”
“During this brief period, our top priority is maintaining continuity for our existing co-packing and retail customers,” he added. “We are coordinating closely to minimize disruptions to the extent permitted by the process and will share updates as soon as possible once it concludes. Following completion of the foreclosure, we expect to emerge with strengthened sponsorship and liquidity and to evaluate capacity investments aimed at better serving current partners. Any consideration of additional co-packing opportunities would be incremental and capacity-dependent, and not at the expense of existing relationships.”
Flow first announced it received a $2 million senior secured business purpose loan from NFS in May 2025, with a binding term sheet for an additional loan of up to $4 million. At the same time, Flow reported it entered an agreement with RI Flow for a secured convertible loan of up to $6 million.
A final tranche of $2 million loaned from RI Flow was announced on August 8. By August 25, the company said it was facing foreclosure from both lenders and that CEO Nicholas Reichenbach was being replaced in the chief executive role by an interim group of executives and directors.
The foreclosure has raised concerns about the future of Flow’s co-packing business, which specializes in Tetra Pak filling options and counts brands like Beatbox, Joyburst and BioSteel among its customers.
Joyburst CEO Brad Woodgate told BevNET this week that he will continue producing his brand with Flow for as long as the brand’s current contract is active, but that he has already begun sourcing alternative co-packers to meet the brand’s needs in the event that Flow’s production capabilities became strained during the foreclosure process.
This story has been updated to include additional comment from Paul Dowdall.