Premium Brands Inc.
TSX : FFF

Premium Brands Income Fund

Premium Brands Income Fund

July 15, 2005 08:30 ET

Premium Brands Inc. and Premium Brands Income Fund Announce Approval of Income Trust Conversion and Pricing of Previously Announced Financing

RICHMOND, BRITISH COLUMBIA--(CCNMatthews - July 15, 2005) - NOT FOR DISTRIBUTION IN THE UNITED STATES OR DISSEMINATION TO U.S. WIRE SERVICES

Premium Brands Inc. ("Premium Brands") (TSX:FFF) and Premium Brands Income Fund (the "Fund") announced today that:

1. shareholders have approved the previously announced plan of arrangement pursuant to which Premium Brands will be converted from a corporate entity to an income trust; and

2. an underwriting agreement relating to the previously announced initial public offering of trust units (the "Units") of the Fund has been executed with a group of underwriters.

Income Trust Conversion

At the annual and special general meeting of shareholders of Premium Brands held earlier today, shareholders approved a plan of arrangement pursuant to which Premium Brands will be converted from a corporate entity to an income trust. A total of 6,978,866 votes (representing 99.98% of the total votes cast at the meeting) were cast in favour of the proposed plan of arrangement. No shareholders have exercised dissent rights.

Final implementation of the arrangement is subject to satisfaction of certain conditions, including approval of the arrangement by the British Columbia Supreme Court. The arrangement is currently scheduled to be completed on or about July 27, 2005.

Initial Public Offering and Secondary Offering

Under the terms of the underwriting agreement referred to above, the Fund will issue a total of 3,275,000 Units at a price of $10.70 per Unit for gross proceeds of $35,042,500. The Fund has also granted the underwriters an over-allotment option to purchase an additional 196,000 Units at $10.70 per Unit for a period of 30 days after closing. Closing is expected to occur on or about July 27, 2005. The Fund will use the net proceeds of the offering to reduce debt currently owing by Premium Brands.

In addition, the underwriting agreement provides that Banyan Capital Partners Limited Partnership will sell an additional 639,307 Units to the public on the same terms and conditions. The Fund will not receive any proceeds from this secondary offering of Units.

The Fund expects to file a final prospectus relating to the initial public offering and secondary offering shortly. A copy of the Fund's final prospectus, once it is filed, may be obtained from www.sedar.com. The Toronto Stock Exchange has conditionally approved the listing of the Units under the symbol "PBI.UN", subject to the Fund satisfying certain customary requirements.

The underwriting syndicate for this transaction is co-led by Scotia Capital Inc. and CIBC World Markets Inc., and also includes RBC Dominion Securities Inc., Raymond James Ltd. and TD Securities Inc.

Premium Brands is a leading manufacturer and marketer of a broad range of branded specialty food products. In addition, Premium Brands operates proprietary food distribution networks through which it distributes both its own products and those of third parties.

These securities have not been, nor will they be, registered under the United States Securities Act of 1933, as amended, and may not be offered or sold in the United States without registration or application exemption from the registration requirements of that Act. This news release does not constitute an offer for sale of these securities in the United States.

Forward-Looking Information

Statements made in this press release, and elsewhere, that look forward in time or include anything other than historical information, involve risks and uncertainties that may affect the actual outcome. For details on these risks and uncertainties please refer to Premium Brands' most recent Annual Information Form filed with securities regulatory authorities, a copy of which is available via SEDAR at www.sedar.com.


Contact Information

  • Premium Brands Inc.
    George Paleologou
    President
    (604) 656-3100
    or
    Premium Brands Inc.
    Will Kalutycz
    CFO
    (604) 656-3100