November 23, 2006 08:00 ET

Eveready Income Fund Strengthens Its Presence in Northwestern Alberta

EDMONTON, ALBERTA--(CCNMatthews - Nov. 23, 2006) - Eveready Income Fund (TSX:EIS.UN) ("Eveready") announces that it has closed the second stage of its previously announced acquisition of the business and assets of D&G Water & Vacuum Services; consisting of the assets of D&G Industry Services Ltd. and NPPP Ventures Ltd. ("D&G"). This acquisition was originally announced on July 17, 2006. Based in High Level, Alberta, D&G provides water truck and vacuum services to customers in the oil and gas industry. D&G's business will be integrated into Eveready's current operations in northwestern Alberta.

The first stage of the business acquisition was completed on August 1, 2006, when Eveready acquired the equipment of D&G for cash proceeds equal to approximately $3.7 million. This value was based on the equipment's fair market value, as determined by a third party appraisal. The remainder of the business and assets of D&G were acquired in the second stage of the business acquisition for total consideration of approximately $3.3 million, consisting of (i) $2.6 million in cash and (ii) $676 thousand through the issuance of 100,000 Fund units at a deemed price of $6.76 per Unit. The total consideration paid to complete both stages of this business acquisition was approximately $7.0 million.

"This acquisition will allow us to expand our operations geographically in northern Alberta and help us obtain the additional equipment and manpower resources we need to meet the demand for our services in the region," comments Rod Marlin, Eveready's President and Chief Executive Officer.

Eveready estimates that D&G could generate EBITDA of approximately $2.0 to $2.5 million on an annual basis.

Eveready is a growth oriented income fund that provides industrial and oilfield services; health, safety, and environmental services; and oilfield equipment rental services to the energy, resource, and manufacturing sectors. The Units of Eveready trade on the Toronto Stock Exchange under the trading symbol "EIS.UN".

EBITDA is a supplemental earnings measure that does not have any standardized meaning prescribed by Canadian GAAP and may not be comparable to EBITDA calculated by other funds or entities. EBITDA is a useful supplemental measure as it provides an indication of the financial results generated by Eveready's principal business activities prior to consideration of how these activities are financed or how the results are taxed in various jurisdictions and before non-cash amortization expense. EBITDA is defined as earnings before interest, taxes, depreciation and amortization.

This press release contains forward-looking statements subject to various risk factors and uncertainties, which may cause the actual results, performances or achievements of Eveready to be materially different from any future results, performances or achievements expressed or implied by such forward-looking statements. Such factors include, but are not limited to, fluctuations in the market for oil and gas and related products and services, political and economic conditions, the demand for services provided by Eveready, industry competition and Eveready's ability to attract and retain both customers and key personnel.

Contact Information

  • Eveready Income Fund
    Rod Marlin
    President & CEO
    (780) 451-6075
    (780) 451-2142 (FAX)
    Eveready Income Fund
    John M. Stevens
    Senior Vice-President & CFO
    (780) 451-6075
    (780) 451-2142 (FAX)
    Website: www.evereadyincomefund.com