West 49 Inc.
TSX : WXX

August 18, 2005 10:29 ET

West 49 Announces $15,000,000 Private Placement

BURLINGTON, ONTARIO--(CCNMatthews - Aug. 18, 2005) -

NOT FOR DISTRIBUTION INTO THE UNITED STATES

West 49 Inc. ("West 49") (TSX:WXX) announced today that it has entered into an agreement with a syndicate led by Desjardins Securities Inc. ("Desjardins") (the "Agents"), pursuant to which the Agents have agreed to place, by way of private placement on a best efforts basis, common shares (the "shares") for total gross proceeds of approximately $15 Million at a price of $1.90 per Common Share.

The net proceeds from the private placement will be used to fund future acquisitions, to finance new store growth, and/or general corporate purposes.

The Common Shares sold pursuant to the private placement will be subject to resale restrictions pursuant to applicable securities law requirements. The private placement financing is scheduled to close on or about August 30, 2005 and is subject to the completion of a definitive agency agreement and the receipt of TSX and other necessary approvals.

The potential acquisitions currently under consideration consist of a Quebec-based clothing retailer (with in excess of 20 stores) and a small e-commerce business. Both of these businesses cater to the same target market as West 49 and share complementary business strategies as well as a similar culture, and both have relationships with some of West 49's key suppliers. In each, management of the potential acquisitions would remain involved and receive, in part, equity of West 49 (subject to Toronto Stock Exchange approval). A Quebec acquisition could enable West 49 to expand into Quebec with its existing brands more readily, and could lead to the Quebec business expanding into other parts of Canada. While letters of intent have been signed, at this time there can be no assurance that these acquisitions will proceed, or as to the terms thereof. Due diligence is currently under way on both prospects. Such acquisitions, if completed, based on currently completed due diligence, are expected to be immediately accretive to earnings per share.

This news release does not constitute an offer to sell or a solicitation of an offer to buy any of the securities in the United States. The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act") or any state securities laws and may not be offered or sold within the United States or to U.S. Persons unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.

Contact Information

  • West 49 Inc.
    Peter Pigott
    (905) 336-5454, ext. 261