October 12, 2007 17:38 ET

Granby Industries Income Fund Provides Update on Credit Facilities

GRANBY, QUEBEC--(Marketwire - Oct. 12, 2007) - Granby Industries Income Fund (TSX:GBY.UN) (the "Fund") announced today that as previously reported it is in breach of certain covenants under its credit facilities as at September 30, 2007. Fund holds an eighty per cent (80%) interest in Granby Industries Limited Partnership ("Granby" or "Granby LP").

"Granby is working closely with its lenders towards a resolution of this matter" said Paul Antoniadis, Chief Financial Officer. "A significant unitholder has indicated its interest in providing financial support to the Fund, and is currently in discussions with the Fund and its lenders regarding the possible terms of such support."

Granby intends to seek a waiver from its lenders or renegotiate the terms of its credit facility or seek alternative financing prior to the maturity of the existing credit facility on January 31, 2008. There can be no assurance that Granby will be able to do so at all or on favourable terms. A failure to comply with the obligations in the credit facilities could result in the acceleration of the relevant indebtedness under the credit facilities, in which case there can be no assurance that the assets of Granby would be sufficient to repay in full that indebtedness. In addition, the ability of Granby to continue as a going concern and to realize the carrying value of its assets and discharge its liabilities when due is dependent on the successful completion of the actions taken or planned relating to the breach of certain covenants under its credit facilities.

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