BFI Canada Income Fund

BFI Canada Income Fund

January 05, 2005 09:00 ET

BFI Canada Income Fund Announces Closing Of $374 Million Offering Of Subscription Receipts




JANUARY 5, 2005 - 09:00 ET

BFI Canada Income Fund Announces Closing Of $374
Million Offering Of Subscription Receipts


BFI Canada Income Fund (TSX: BFC.UN) announced today that it has
successfully completed its previously-announced offering of 14,166,667
subscription receipts. In addition, the underwriters have exercised
their option to acquire an additional 1,416,667 subscription receipts at
the closing, resulting in total proceeds to the Fund of approximately
$374 million.

The underwriters of the offering were CIBC World Markets Inc., BMO
Nesbitt Burns Inc., National Bank Financial Inc., TD Securities Inc.,
Scotia Capital Inc., Sprott Securities Inc. and First Associates
Investments Inc.

The offering was undertaken in connection with the agreement between the
Fund and IESI Corporation to combine their respective businesses (the
"Transaction"), to create one of the largest non-hazardous solid waste
management companies in North America. Pursuant to the Transaction, the
Fund will indirectly acquire 100% of the common stock of IESI, and the
current equity investors in IESI will retain an approximately 35.6%
indirect interest in the Fund. The Transaction is expected to close on
or about January 21, 2005, subject to satisfaction of various
conditions, including unitholder approval and the receipt of all
necessary regulatory approvals. A special meeting of unitholders of the
Fund will be held on January 20, 2005 at the Gallery, Toronto Stock
Exchange, 130 King Street West, Toronto, Ontario at 10:00 a.m. EST to
approve the Transaction, among other things.

The proceeds of the offering will be held in escrow pending the closing
of the Transaction. Upon release, the proceeds will be applied (together
with the proceeds of new debt financing) to repay substantially all of
IESI's third party debt as well as indebtedness of BFI Canada Holdings
Inc. used to fund its acquisition of the Ridge landfill, which closed on
January 4, 2005.

The subscription receipts will trade on the Toronto Stock Exchange under
the symbol "BFC.R" until the completion of the Transaction, at which
time they will be automatically exchanged for units of the Fund.
Following the exchange of subscription receipts for units, the former
holders of the subscription receipts will be entitled as unitholders to
receive distributions from the Fund. Holders of the former subscription
receipts will also be entitled to receive an amount per subscription
receipt, if any, equal to the per unit distribution paid or payable to
the holders of the units in respect of all record dates occurring during
the period from the offering closing date to the Transaction closing
date, as if the subscription receipts had been converted to units
immediately prior to such record dates. In no case will holders of
subscription receipts be eligible to receive any amount in respect of
the distribution to be paid on January 15, 2005 to unitholders of record
on December 31, 2004.

If the Transaction fails to close by 5:00 p.m. (Toronto time) on March
1, 2005 or if the Transaction agreement is terminated at any earlier
time (in either case, the "Termination Date"), Computershare Trust
Company of Canada, as the escrow agent, and the Fund will return to the
holders of subscription receipts, commencing on the third business day
following the Termination Date, an amount equal to the issue price
therefor and their pro rata entitlements to interest earned on such
amount (less any withholding taxes applicable to non-resident holders).
If the Transaction closing does not occur on or before March 1, 2005
because the parties have not received all necessary consents to the
Transaction, the Fund may request that the Termination Date be extended
to a date not later than March 31, 2005 (the "Extension Date"). If the
Underwriters agree to extend the Termination Date but the Transaction
closing does not occur on or before the Extension Date, the Fund will
return to the holders of subscription receipts, commencing on the third
business day following the Extension Date, an amount equal to (i) the
issue price therefor and their pro rata entitlements to interest earned
on such amount, plus (ii) an amount per subscription receipt equal to
the per Unit distribution payable to unitholders relating to any record
date occurring on or after March 1, 2005 to and including March 31, 2005
(less any withholding taxes applicable to non-resident holders).

About BFI Canada

BFI Canada Income Fund, through its subsidiaries, is one of Canada's
largest full-service waste management companies, providing non-hazardous
solid waste collection and landfill disposal services for municipal,
commercial, industrial and residential customers in the provinces of
British Columbia, Alberta, Manitoba, Ontario and Quebec. The Fund's
units are listed on the Toronto Stock Exchange under the symbol BFC.UN.
For more information on the Fund, visit

Notes to Readers

This news release shall not constitute an offer to sell or the
solicitation of an offer to buy, nor shall there be any sale of the
securities described herein in any jurisdiction in which such offer,
solicitation or sale would be unlawful prior to qualification or
registration under applicable securities laws of any such jurisdiction.
The securities described herein have not been, and will not be,
registered under the United States Securities Act of 1933 (the
"Securities Act") and may not be offered or sold in the United States
except pursuant to an exemption from the registration requirements of
the Securities Act.

This news release may contain "forward-looking statements" relating to
the Fund and IESI Corporation within the meaning of applicable
securities laws, including Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended. The use of any of the words "anticipate", "continue",
"estimate", "expect", "may", "will", "project", "should', "believe" and
similar expressions are intended to identify forward-looking statements.
These statements involve known and unknown risks, uncertainties and
other factors that may cause actual results or events to differ
materially from those anticipated in such forward-looking statements.
Certain of these risks and uncertainties include: the combined business
is capital intensive and may consume cash in excess of cash flow from
its operations and borrowings; the combined business' growth strategy
depends, in part, on acquiring other solid waste management or related
businesses and expanding existing landfills an other operations, which
the combined business may be unable to do; the combined business may not
be able to successfully manage its growth; the combined business faces
risks related to certain deficiencies in the operation of the combined
business' internal control over financial reporting and disclosure
controls and procedures; competition could reduce the combined business'
profitability or limit its ability to grow;
provincial, state and municipal requirements to reduce landfill
disposal by encouraging various alternatives may adversely affect the
combined business' ability to operate landfills at full capacity; the
combined business may lose contracts through competitive bidding or
early termination, which would cause revenue to decline; the combined
business' U.S. operations are geographically concentrated in the
northeastern and southern United States and susceptible to those
regions' local economies and regulations; the loss of the City of New
York as a customer could have a significant adverse effect on the
combines business' operations; the ability of the combined business to
pay dividends or make other payments or advances (which will support
distributions of the Fund's units) will be subject to applicable laws
and contractual restrictions contained in the instruments governing the
indebtedness of those entities; the degree to which the combined
business is leveraged could adversely affect its financial condition and
make it more difficult for the combined business to make payments with
respect to its debt; despite its current indebtedness, the combined
business to made require additional equity or debt financing to fund its
growth and debt repayment obligations; the ability of the combined
business to service its debt, remain competitive, sustain its growth and
expand its operations will require large amounts of cash, and the
combined business' ability to generate cash depends on many factors,
some of which are beyond its control; the interests of the retained
interest holders and their affiliates could conflict with those of other
investors; the combined business depends heavily on its senior
management; if the combined business is unable to obtain performance or
surety bonds, letters of credit or insurance, the combined business may
not be able to enter into additional municipal solid waste collection
contracts or retain necessary landfill operations permits; the combined
business is subject to extensive legislation and governmental regulation
that may restrict its operations or increase its costs of operations;
the combined business may not be able to obtain permits it requires to
operate its business; the combined business may be subject to legal
action relating to compliance with environmental laws; the combined
business may have liability for environmental contamination; and the
combined business will always face the risk of liability, and insurance
may not always be available or sufficient.

The Fund urges you to carefully consider the factors set forth above in
evaluating the forward-looking statements and caution you not to place
undue reliance on such forward-looking statements. There may also be
additional risks that the Fund does not presently know of or that the
Fund currently believe are immaterial, which could also impair their
respective business. In light of these risks, uncertainties and
assumptions, the forward-looking events may or may not occur. Additional
information regarding these and other factors which could materially
affect the forward-looking statements can be found in the Fund's renewal
annual information form for the period ended December 31, 2003 filed
with the Canadian securities regulatory authorities and in IESI
Corporation's periodic reports filed with the Securities and Exchange
Commission, including the risk factors detailed in Item 7 "Management's
Discussion and Analysis of Financial Condition and Results of
Operations" of IESI Corporation's Annual Report on Form 10-K for the
fiscal year ended December 31, 2003. The forward-looking statements
contained herein are made only as of the date of this news release and
the Fund undertakes no obligation to publicly update the forward-looking
statements to reflect new information, subsequent events or otherwise.


Contact Information

    Joseph D. Quarin, BFI Canada
    Chief Financial Officer
    (416) 401-7722
    Anne MacMicken
    Manager, Investor and Employee Relations, BFI Canada
    (416) 401-7729