Associated Brands Income Fund

Associated Brands Income Fund

October 14, 2005 16:38 ET

Associated Brands Provides Update On Financing Initiatives

TORONTO, ONTARIO--(CCNMatthews - Oct. 14, 2005) - Associated Brands Income Fund (TSX:ABF.UN) provided an update today on its financing initiatives, including the proposed private placement of $10 million of 9% exchangeable subordinated debentures announced on August 22, 2005 and revisions to its existing credit facility.

Management commented that the due diligence investigation by the principal purchaser of the debentures has been largely completed. The private placement is expected to be completed on or before October 31, 2005. Subject to the completion of the debenture offering, the Fund's lender will revise its existing credit facility to provide for new credit terms going forward. In addition, the Fund's lender has extended its waiver of certain financial covenant breaches up to and including October 31, 2005. There can be no assurance, however, that such transactions will be completed, and the failure to complete them could have a material adverse impact on the Fund's financial condition and the value of the Fund's units.

"The completion of this new financing, and the revised credit agreement, will provide increased financial flexibility necessary until our numerous sales, marketing and operational initiatives return Associated Brands to its historical track record of growth and stable financial performance," stated John Currie, Executive Chairman.

"We expect the planned capital investment projects to be funded by this financing will improve our operating efficiency, increase production capacity and support our rigorous focus on customer service. Once completed we expect these initiatives will enhance our distributable cash commencing in the latter half of 2006 and going forward," added Rob Dougans, President and Chief Executive Officer.

Associated Brands Income Fund (TSX:ABF.UN), through its operating subsidiaries, is a leading North American manufacturer and supplier of private-label dry blend food products and household products. Since beginning operations in 1985, Associated Brands has grown to become one of the three largest suppliers of a diverse range of private-label dry-blend food products in North America, producing over eleven million cases annually across multiple product categories currently sold to 44 of the 50 largest North American food retailers. Associated Brands plans to build unitholder value by leveraging its solid presence in the U.S. private-label market, expanding its product offerings to current and new customers and adding additional contract manufacturing business, and through accretive acquisitions that meet its strict operating and strategic criteria. More information can be obtained at

Certain statements in this press release may include "forward-looking" statements which involve known and unknown risks, uncertainties and other factors which may cause actual results, performance or achievements of Associated Brands Income Fund to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. When used in this press release, such statements use such words as "may", "will", "expect", "anticipate", "project", "believe", "plan", and other similar terminology. The risks and uncertainties are detailed from time to time in reports filed by the Fund with the securities regulatory authorities in all of the provinces and territories of Canada. New risk factors may arise from time to time and it is not possible for management to predict all of those risk factors or the extent to which any factor or combination of factors may cause actual results, performance and achievements of the Fund to be materially different from those contained in forward-looking statements. Given these risks and uncertainties, investors should not place undue reliance on forward-looking statements as a prediction of actual results.

Contact Information

  • Associated Brands Income Fund
    John Currie
    Executive Chairman
    (416) 503-7001