ComWest Enterprise Corp.

June 08, 2012 09:00 ET

ComWest Announces Investment in Organic Dye and Fiber Technology

VANCOUVER, BRITISH COLUMBIA--(Marketwire - June 8, 2012) - ComWest Enterprise Corp. (TSX VENTURE:CWP)(TSX VENTURE:CWP.A) (the "Company") is pleased to announce that it has made an initial equity investment of US$1 million in a private corporation ("Ploughboy"), based in Raleigh, North Carolina, operating under the trade name Ploughboy Organicstm. Ploughboy is the owner of a patent pending technology developed by its founder and CEO, Suzanne DeVall, which can convert the tobacco plant into dyes, fibers, textiles and other products with minimal environmental impact. The Ploughboy technology opens up an opportunity for the tobacco plant, which has never before been used to produce fiber or dyes, to become a new global and renewable raw material resource.

The textile industry is in need of alternative sources of dyes and fibers which are sustainable, organic and non-toxic. Eco-friendly products continue to be a key growth driver for the dye and textile industry, highlighted in many reports and by research groups internationally. Analysts, Inc. has said the global market for textile dyes alone is projected to reach US$5.5 billion by the year 2015, driven in part by innovative eco-friendly dyes and chemicals, and resurgence in post-recession demands. Cotton is still the fiber of choice, with global sales of "organic" cotton apparel and home textile products reaching an estimated US$4.3 billion in 2009 - a 35% increase over 2008. Environmentally conscious consumers, businesses and governments want innovative textile and apparel products that meet their expectations for fashion and performance from sustainable, natural, eco-friendly "green" materials. The unique properties of the tobacco plant and its ability to be grown in a certified organic manner, allows the plant to be used in its entirety to produce fiber and dyes with minimal environmental impact and waste. Additionally, it is naturally antimicrobial and produces natural, beautiful organic dyes creating the opportunity to develop truly certified organic clothing that encompasses both the dying as well as the production of fibers that can be blended with cotton, wool, silk and cashmere.

With the assistance of research performed at North Carolina State University, the Ploughboy technology has achieved the proof of concept stage with respect to the production capability for organic dyes and fibers. Pre-commercial production of dye concentrate is expected to be in place by this summer, allowing Ploughboy to produce sample dye orders to major retail brands and textile manufacturers and be in a position to expand its reach and capacity through license agreements with major dye houses in North America and abroad.

The World Bank estimates that 17-20 percent of industrial water pollution comes from textile coloration and treatment. The Ploughboy innovation could have a positive impact on this worldwide environmental problem since the tobacco plant can be grown in most agricultural regions of the world as a fiber and dye resource with the potential to support and revive depressed agricultural communities and bring processing and manufacturing jobs to the region.


ComWest is a profitable dividend paying corporation that has operated in the garment industry since its acquisition of Peerless Garments LP in August 2010. Peerless has been in operation out of its Winnipeg, Manitoba, facility for over 70 years and over the past three decades has been a leading supplier of garments and related accessories to the Department of National Defense, the RCMP and other governmental and retail institutions who are showing significant interest in fostering green sustainable products. ComWest is hopeful that its investment and support of Ploughboy will eventually assist in strengthening the agricultural industries in North America and foster a paradigm shift to the re-domestication of the textile and dye industries through the transitioning of tobacco farming into the production of sustainable organic fibers, dyes and other byproducts.

Under the terms of the investment arrangement, ComWest has committed to invest US$2 million in the form of a series of convertible preferred share investments carrying an 8% cumulative dividend. In addition, ComWest has the option to increase its equity interest in Ploughboy to approximately 50% and (subject to certain regulatory, shareholder and board approvals) after eighteen months acquire a 100% ownership of Ploughboy through a share exchange at relative valuations to be determined at that time.

On behalf of the Board

Douglas F. Good, President

Forward-Looking Statements

This news release contains forward-looking statements regarding the future success of the business of the Company that is subject to risk and uncertainties. Examples of such forward-looking statements including, but are not limited to, statements concerning the impact of our investment in Ploughboy, our expectation regarding further investment in Ploughboy, the opportunities for the tobacco plant to become a raw material resource and our expectations regarding Ploughboy's timing for pre-commercial production. These forward-looking statements involve known and unknown risk and uncertainties that may cause the Company's actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied in these forward-looking statements. These risks include risks related to dependence on key personnel, competition, risks related to newly acquired businesses, uncertainty and dilution of additional financing and ability to service debt, as well as the risk factors described in the Corporation's Management Discussion and Analysis filed on SEDAR at The forward-looking statements contained herein are made as of the date of this news release and are expressly qualified in their entirety by this cautionary statement. Except as required by law, the Company undertakes no obligation to publicly update or revise any such forward-looking statements to reflect any change in its expectations or in events, conditions or circumstances on which any such forward-looking statements may be based, or that may affect the likelihood that actual results will differ from those set forth in the forward-looking statements.

Neither the TSXV nor its Regulation Services Provider (as that term is defined in the policies of the TSXV) accepts responsibility for the adequacy or accuracy of this release.

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