The CEO of Body Shop Canada Limited clarified that it is seeking creditor protection because the parent company has stripped its Canadian arm of cash and pushed it into debt.

Jordan Searle said in an affidavit that the company's situation "deteriorated sharply" in December, after the parent company The Body Shop International Ltd. was purchased by the private equity firm Aurelius.

The general manager of Body Shop Canada found that Body Shop International continued to take its money but did not pay suppliers because the parent company said it had lost access to its financing and was slowing payments to creditors to conserve cash.

Searle added that Body Shop Canada was accustomed to the parent company taking money from its account because the companies used cash pooling arrangements, where the parent company took the subsidiary's revenues and paid its expenses.

When Body Shop International sought a form of creditor protection called administration last month in the UK, Searle said Body Shop Canada owed $3.3 million in debts and there was no likelihood of assistance from its owners.

The lawyers for The Body Shop International and Aurelius did not respond to requests for comment on Searle's affidavit, which was filed days after The Body Shop Canada announced plans to close 33 of its 105 stores.