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Multi-Glass Announces Sale of Contracting Division in Atlantic Canada
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Multi-Glass International Corp. ("Multi-Glass") of Toronto announces that it has entered into an asset purchase agreement with three companies based in 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").
In announcing the transaction Bob Fellows, President and Chief Executive Officer of Multi-Glass said, "As one of Canada's largest insulation distributors, 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 consists of primarily receivables and work-in-progress, less the liabilities associated with those assets. The sale proceeds of approximately $3.6 million will be paid in cash of $2.6 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, 120 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 to occur on September 30, 2005 and is conditional upon approval from the TSX-Venture Exchange, and the completion of a due diligence process. (No agent or finder's fees will be paid as part of this transaction.)
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September 22nd, 2005
Source: Ccnmatthews.com |
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