November 19, 2007 17:24 ET

Granby Industries Income Fund Announces Board Resigntion and Unsolicited Conditional Proposal to Acquire Units

GRANBY, QUEBEC--(Marketwire - Nov. 19, 2007) - Granby Industries Income Fund (TSX:GBY.UN) (the "Fund") today announced that Eric Berke, Managing Partner of Torquest Partners Inc. ("Torquest"), has tendered his resignation from the Fund's Board of Trustees. Mr. Berke served on the Fund's Board of Trustees since his nomination on November 2, 2004. Mr. Berke and Mr. Alan Lever, also of Torquest, have also resigned from the board of directors of Granby Industries Inc., the general partner of Granby Industries Limited Partnership.

Mr. Berke's resignation follows the receipt by the Fund of an unsolicited proposal from Clarke Inc. ("Clarke") to acquire all of the issued and outstanding trust units of the Fund at a discount to the current trading price of the units. Clarke's non-binding proposal is subject to numerous conditions, including a condition that Clarke acquires all of the Class B LP units of Granby Industries Limited Partnership which are currently held by funds managed by Torquest. The Fund holds an eighty per cent (80%) interest in Granby Industries Limited Partnership.

Based on publicly filed information, Clarke holds 1,699,182 units of the Fund, representing approximately 23% of the outstanding units. As well, the Fund has been advised that Clarke has taken an assignment of a $15.75 million term loan provided to the Fund by two Canadian chartered banks, which loan matures on January 31, 2008.

The Board of Trustees has formed a Special Committee of independent trustees to consider Clarke's proposal and the Fund's alternatives. The Special Committee has engaged legal counsel and financial advisors to assist it in its duties.

There can be no assurance that Clarke's proposal will result in a binding offer or that a transaction with Clarke or any other person will be completed.

About Granby Industries Income Fund

Granby Industries is a leading North American manufacturer of high quality tanks for the residential and light commercial storage of heating oil and other petroleum-based products and is also a leading manufacturer of coated copper tubing. Granby has been operating in the heating oil storage tank industry for more than 50 years and its primary business is manufacturing replacement residential tanks. Granby Industries has operations in Granby, Quebec and Oakville, Ontario.

Forward-looking information is based on certain factors and assumptions regarding, among other things, expected storage tank unit volumes, the price of raw materials and the average US/Canadian dollar exchange rate during the year. While Granby considers these assumptions to be reasonable based on information currently available to it, they may prove to be incorrect. Forward-looking information is subject to certain factors, including risks and uncertainties, which could cause actual results to differ materially from what we currently expect. These factors are described in the Fund's Annual Information Form available on and include, among other things, leverage and restrictive covenants, economic conditions, the seasonality of demand for Granby's products, the risk of increased heating oil costs, which could depress demand for heating oil storage tanks, commodity pricing volatility and foreign exchange risk, regulatory change, interest rate fluctuation, a decline in the housing and major consumer products markets, dependence on key suppliers, reliance on major customers and the risk of increased competition in the coated copper tubing market and the storage tank market.

You should not place undue importance on forward-looking information and should not rely upon this information as of any other date. While Granby may elect to, it is under no obligation and does not undertake to update this information at any particular time, except as required by law.

Contact Information

  • Granby Industries Income Fund
    Mr. Paul Antoniadis, CA
    Vice President, Finance & CFO
    450-378-2334 ext. 225