Westshore Terminals Income Fund

Westshore Terminals Income Fund

December 19, 2006 20:00 ET

Westshore Terminals Income Fund Announces Equity Offering

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - Dec. 19, 2006) - Westshore Terminals Income Fund (TSX:WTE.UN) (the "Fund") announced today that it is proceeding to raise approximately $40 million from the issuance of units of the Fund for the purpose of funding the previously announced capital additions at the Roberts Bank Coal Terminal. Particulars of the capital additions are set out in the Fund's annual information form. The Fund's third quarter report issued on November 3, 2006 confirmed the decision to proceed with the project.

The issuance of units will be achieved in part by a rights offering to existing unitholders. The rights offering will be underwritten by or on behalf of Jim Pattison Developments Ltd., a member of The Jim Pattison Group. An affiliate of that company provides management services to Westshore Terminals Ltd. and administrative services to the Fund under contracts originally entered into in 1997 at the time of the Fund's initial public offering. Jim Pattison Developments has also agreed to subscribe directly for approximately $20 million worth of units of the Fund.

Unitholders will receive rights to subscribe for approximately $20 million worth of units, and will have an additional (second stage) subscription privilege to subscribe for any units not taken up on the exercise of rights. In accordance with the policies of The Toronto Stock Exchange, the rights will be listed for trading. It is expected that the rights will begin trading and the exercise period for the rights will commence approximately mid-January 2007, following completion of the clearance of the rights offering circular by the regulatory authorities. It is expected that the rights offering will be completed before the end of February 2007.

The issue price for the units under both the placement to Jim Pattison Developments and under the rights offering will be $10.45 per unit, being the weighted average trading price of the units on The Toronto Stock Exchange for the five day period ended December 18, 2006, less a discount of approximately 10%. This pricing is in accordance with the requirements of the TSX. Upon completion of the rights offering and private placement, a total of approximately 3.9 million additional units of the Fund will be issued, representing 5.5% of the currently outstanding number of units.

Jim Pattison Developments presently beneficially owns, directly and indirectly, 6,655,100 units of the Fund, being approximately 9.5% of the Fund units outstanding. When added to the units to be acquired upon completion of the direct purchase and the exercise of its rights, Jim Pattison Developments would have direct and indirect beneficial ownership of 8,754,704 units being approximately 11.8% of the 74,250,017 Fund units to be outstanding following completion of the direct purchase and the rights offering. If none of the existing unitholders exercise their rights, Jim Pattison Developments would purchase an additional 1,769,305 units under its standby commitment, resulting in Jim Pattison Developments holding 10,524,009 Fund units, or approximately 14.2% of the Fund units outstanding, following completion of the rights offering.

The Fund units that Jim Pattison Developments has agreed to acquire under the direct subscription and pursuant to the standby commitment are being acquired and will be held for investment purposes. In the future, Jim Pattison Developments or its affiliates may acquire additional Fund units or dispose of Fund units, subject to a number of factors, including general market and economic conditions and other investment and business opportunities available to it.

It is not expected that a soliciting dealer will be retained in connection with the exercise of rights, and no commissions or standby fees will be payable in connection with the placement of the securities or the commitment of Jim Pattison Developments to take down any units not subscribed for.

Contact Information

  • Westshore Terminals Income Fund
    Nick Desmarais
    (604) 488-5295