Empire Industries Ltd.

Empire Industries Ltd.

March 14, 2007 15:05 ET

Empire Industries Ltd.: Signs Letter of Intent to Acquire KWH Constructors Corp.

TORONTO, ONTARIO--(CCNMatthews - March 14, 2007) - Empire Industries Ltd., (TSX VENTURE:EIL) ("Empire"), one of Western Canada's fastest growing steel fabrication and construction service providers, today announced that it has signed a letter of intent to purchase all of the issued and outstanding shares of Burnaby, B.C. based, KWH Constructors Corp. (www.kwhconstructors.com), its wholly owned US subsidiary KWH Constructors Inc. and its wholly owned division, Somerset Engineering (www.somerseteng.com) (collectively called "KWH Group"). Empire is also pleased to announce that the three principals of KWH Group, namely Jeff Mullins, Peter Saunderson and Bob Hawk, will join the executive management committee of Empire.

The purchase price will be $5.2 million, which includes working capital of $1.5 and will be paid for with a combination of cash, promissory notes and 3,636,363 Empire common shares, at a price of $0.55 per share. The three KWH principals will own approximately 6% of Empire after giving effect to the terms of this acquisition which is scheduled to close April 1, 2007. In the prior year, KWH Group generated revenue of $15 million and normalized EBITDA of $1.5 million.

KWH Group has been in operation since 1989. KWH Group is a full service, turn-key construction company specializing in all erection-oriented projects. KWH Group have a specialized technical competency as an engineered erector and installer of bridges, machinery, heavy equipment and complex structures. When it comes to the challenging field of construction erection, KWH offers its clients superior standards of performance and workmanship, based on its unique complement of highly experienced staff. From the three founding partners, to the team of structural engineers, to the steel detailers, to its construction superintendents and field supervisors, KWH people undertake complex construction erection projects from start to finish.

"The addition of the KWH Group's expertise in both the erection and engineering fields, perfectly compliments Empire's already formidable steel fabrication and erection capabilities. This acquisition further demonstrates Empire's commitment to making strategic acquisitions and pursuing high value-added organic growth. It also enhances Empire's position as a one stop shop for steel fabrication and construction services in Western Canada," stated Guy Nelson, CEO of Empire Industries Ltd. "Peter, Bob, and I are very excited about the prospects going forward of joining the Empire team," stated Jeff Mullins.

About Empire Industries Ltd.

Empire Industries Ltd. is a public company that was formed in July 2006. Empire Industries Ltd. is one of Western Canada's fastest growing steel fabrication and construction service providers. It operates its business through four wholly owned subsidiaries: Empire Iron Works Ltd., George Third and Son Ltd., Ward Industrial Equipment Ltd., Hopkins Steel Works Ltd, and a 49% ownership interest in Sorge's Welding Ltd. Empire's mandate is to increase shareholder value by growing profits organically, by targeting acquisitions and by expanding its market share in the burgeoning industrial, commercial and institutional construction marketplace of Western Canada. The Corporation trades on the TSX Venture Exchange under the trading symbol EIL.

This press release contains forward-looking statements, within the meaning of applicable securities legislation, concerning Empire's business and affairs. These statements are identifiable by their use of verbs such as "expect", as well as by the use of future or conditional tenses. These forward looking statements are based on current expectations, and are naturally subject to uncertainty and changes in circumstances that may cause actual results to differ materially. Readers are cautioned not to place undue reliance on such forward-looking statements. Empire assumes no obligation to revise or update these forward-looking statements to reflect the occurrence of unanticipated future events, except as may be required under applicable securities laws.

The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release.

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