Universal Energy Group Ltd.
TSX : UEG

Universal Energy Group Ltd.

December 11, 2008 17:54 ET

Universal Energy Group Expands Its US Operations Through the Acquisition of Commerce Energy, Inc.

TORONTO, ONTARIO--(Marketwire - Dec. 11, 2008) - Universal Energy Group Ltd. ("Universal Energy Group") (TSX:UEG) is pleased to announce the acquisition, through its wholly owned subsidiary, Commerce Gas and Electric Corp., of Commerce Energy, Inc. ("Commerce"), the operating subsidiary of Commerce Energy Group, Inc., for a cost to Universal Energy Group of approximately US$26 million. Universal Energy Group has also assumed certain letter of credit obligations related to the existing supply arrangements required to serve the Commerce customer base. These obligations will unwind as current suppliers are replaced with Universal Energy Group supply and credit arrangements.

Through this acquisition Universal Energy Group has acquired over 90,000 residential, commercial and industrial customers located in the U.S. in energy deregulated states. On an RCE equivalent basis, Commerce serves approximately 170,000 RCEs, including an industrial portfolio, with a combination of fixed term and month to month energy contracts.

Mark Silver, CEO of Universal Energy Group said "This transaction positions the company for successful growth in key US markets. Commerce's platform puts us in almost every major deregulated market in the US. Leveraging our supply and credit arrangements will allow us to extract significant value from the more than $25 million in annual operational margin generated from the Commerce customer base."

Universal Energy Group's common shares and convertible subordinated debentures are listed on the Toronto Stock Exchange under the symbol "UEG" and "UEG.DB", respectively. Universal Energy Group through its subsidiary Universal Energy Corporation, sells electricity and natural gas in Ontario and natural gas in British Columbia to residential, small to mid-size commercial and small industrial customers. Universal Energy Group through its subsidiary Universal Gas & Electric Corporation, sells natural gas in Michigan to residential, small to mid-size commercial and small industrial customers. Universal Energy Group through its subsidiary National Energy Corporation, operating under the trade name National Home Services, sells long-term water heater rental programs to Ontario residential customers. Universal Energy Group through its subsidiary Terra Grain Fuels Inc. operates an ethanol plant near Belle Plaine, Saskatchewan. Additional information about Universal Energy Group is available on SEDAR (www.sedar.com).

Forward-Looking Statements:

This press release contains ''forward-looking statements''. Statements other than statements of historical fact may be forward-looking statements, including, without limitation, management's expectations, intentions and beliefs concerning the future financial position or results of Universal Energy Group. Specific forward-looking statements contained in this news release include, among others, statements regarding the anticipated operational and financial performance of Commerce. These statements are subject to the usual risks associated with Universal Energy Group's retail electricity and natural gas business described in Universal Energy Group's Annual Information Form and to additional risks specific to Commerce and its anticipated performance including: the existence of potential unknown liabilities in connection with the acquisition of Commerce; the ability to effectively integrate the operations of Commerce; and entry into markets in which Universal Energy Group has little or no direct prior experience. Wherever possible, words such as ''may'', ''would'', ''could'', ''will'', ''anticipate'', ''believe'', ''plan'', ''expect'', ''intend'', ''estimate'', ''endeavour'', ''project'', ''continue'' and similar expressions have been used to identify these forward-looking statements. These statements reflect management's current beliefs with respect to future events and are based on information currently available to management. Forward-looking statements involve significant known and unknown risks, uncertainties and assumptions. Many factors could cause our actual results, performance or achievements to be materially different from any future results, performance or achievements that may be expressed or implied by such forward-looking statements, including, without limitation, those listed above and those listed in the ''Risk Factors'' section of Universal Energy Group's filings with securities regulatory authorities. Should one or more of these risks or uncertainties materialize, or should assumptions underlying the forward-looking statements prove incorrect, actual results, performance or achievements could vary materially from those expressed or implied by the forward-looking statements contained in this press release. Undue reliance should not be placed on the forward-looking statements. These forward-looking statements are made as of the date of this press release and Universal Energy Group assumes no obligation to update these forward-looking statements except as expressly required by applicable securities law.

Contact Information

  • Universal Energy Group Ltd.
    Stephen Plummer
    Chief Financial Officer
    (416) 673-1160
    Email: splummer@uegl.ca
    or
    Universal Energy Group Ltd.
    Shawn Dym
    Senior Vice President, Business Development
    (416) 673-4761
    Email: sdym@universalenergy.ca