Loan Guarantee Extended to Palliser-associated Company

The Manitoba government has extended a $15-million loan guarantee to a company controlled by Arthur DeFehr, whose family founded Palliser Furniture.

The guarantee was authorized by Premier Wab Kinew’s cabinet on Aug. 20, allowing Lexington Real Estate Holdings Ltd. to cover debt owed to Access Credit Union.

Lexington is an investment and holding company directed by DeFehr. Though separate from Palliser in legal structure, the loan guarantee is intended to support the furniture manufacturer’s resilience in the face of escalating Canada-U.S. trade risks.

“As Donald Trump’s tariffs continue to threaten Canada’s economy, it is important to protect Manitoba jobs and help Manitoba companies expand their presence in Canada, and the rest of the world,” said Jamie Moss, Minister of Business, Mining, Trade and Job Creation, in a statement to CBC.

Headquartered in Winnipeg, Palliser employs Manitobans in manufacturing and operates both a Pallliser/EQ3 outlet in Transcona, and an EQ3 retail store in Polo Park. CEO Peter Tielmann previously stated that 60 per cent of the company’s manufacturing output is exported to the United States, underlying the company’s exposure to cross-border economic fluctuations.

The decision to grant the loan was made via provincial order in council and not publicly announced by the NDP government.

Finance Minister Adrien Sala was given authority to finalize the guarantee through the Manitoba Development Corp. (MDC), which will set the terms and conditions. No funds will be disbursed by MDC unless a default occurs on the Lexington loan. This structure aligns with provincial economic development strategies that use loan guarantees rather than direct disbursements to manage risk.