Multi-Glass International Corp.

Multi-Glass International Corp.

June 01, 2005 11:02 ET

Multi-Glass Announces Sale of Contracting Division in Atlantic Canada

TORONTO, ONTARIO--(CCNMatthews - June 1, 2005) -

(Not for dissemination in the United States of America)

Multi-Glass International Corp. (TSX VENTURE:MSS) ("Multi-Glass") of Toronto announces that it has entered into a letter of intent with a group of local businessmen from Atlantic Canada (an arm's length transaction), pursuant to which Multi-Glass agreed to sell the contracting operations of Guildfords (2000) Inc. ("Guildfords") which includes the contracting assets of Guildfords, Guild Contracting Specialties (2000) Inc. and Dover Insulation Contractors (2000) Inc., (the "Transaction").

The Guildfords contracting division has been in existence for over 50 years and was acquired by Multi-Glass along with the other business assets of Guildfords in 2000. Today's announcement is consistent with the Multi-Glass corporate growth strategy of focusing on its core business as a distributor and customized fabricator of insulation products to the commercial, industrial and residential markets in Ontario and Atlantic Canada.

In announcing the transaction Bob Fellows, President and Chief Executive Officer of Multi-Glass said, "As one of Canada's insulation distribution market leaders, this sale is consistent with our strategy to get back to our core business in Atlantic Canada. This initiative is part of our company-wide objective of improving our level of service to our customers and providing continuous enhancements to our ordering and distribution processes."

The sale is contingent upon the completion of an acceptable purchase and sale agreement. The sale consists of receivables and work-in-progress, less the liabilities associated with those assets. The sale proceeds of $2.5 million will be paid in cash of approximately $1.5 million and a $1.0 million promissory note, which will be secured with a second charge on the assets of the entity purchasing the assets. The promissory note will bear interest at 5% and will require monthly payments for five years. There will be a contingency holdback of approximately $100,000, which will be paid to Guildfords, 91 days after the closing of the transaction. The cash proceeds will be used to reduce Multi-Glass' operating loan from its principal lender.

The closing of the Transaction is anticipated by July 31, 2005 and is conditional upon approval from the TSX-Venture exchange, the completion of a due diligence process, which will be conducted over the next 60 days as well as entering into of a formal purchase and sale agreement. (No agent or finder's fees will be paid as part of this transaction.)

About Multi-Glass International Corp.

Multi-Glass International, through its subsidiaries, is a leading distributor and customized value-added fabricator of insulation and energy conservation products to the commercial, industrial and residential construction markets in both Ontario and the Atlantic Provinces.

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

Contact Information

  • Multi-Glass International Corp.
    Robert M. Fellows
    President and Chief Executive Officer
    (416) 798-3900, ext. 212
    Multi-Glass International Corp.
    Meier Miller
    Chief Financial Officer and Secretary
    (416) 798-3900, ext. 220