Business
Superior Plus Announces Results of Strategic Review and Confirms Distribution Level at $0.13 per Month
Superior Plus Announces Results of Strategic Review and Confirms Distribution Level at $0.13 per Month.
About this update from Superior Plus Corp
[{"type":"text","content":"\n\n\n\n\nTSX: SPF.UN\n\nCALGARY, July 10 /CNW/ - On April 24, 2006 Superior Plus Income Fund (the\n\"Fund\") and Superior Plus Inc. (\"Superior\") announced the initiation of a\nstrategic review. The process was undertaken in response to the weak first\nquarter results of Superior Propane predominantly caused by record warm\nweather this winter, anticipated weakness in the operating results of ERCO\nWorldwide over the medium term due to the impact of the rapid rise in the\nCanadian dollar and significant increases in electricity prices on ERCO's\noperations and customers, as well as the reduction of the Fund's monthly\ndistribution and the weakness of the unit price. The Board had formed a\nStrategic Review Committee to identify the best possible alternatives to\nmaximize unitholder value. This work has now been completed and consisted of a\ncomprehensive review of each business and the overall structure of the Fund\nwith the assistance of legal and financial advisors.\n\nThe Strategic Review considered a wide range of alternatives including:\n\n>\n\nThe Board of Directors has appointed Grant Billing as Chairman and Chief\nExecutive Officer, effective immediately, replacing Geoff Mackey as President\nand Chief Executive Officer. As well, Mark Schweitzer, Executive\nVice-President and Chief Financial Officer will be leaving Superior on\nNovember 1, 2006, following a recruitment process for his replacement. Geoff\nand Mark have made significant contributions to the growth of the Fund and the\nBoard thanks them for their contribution. The Board is of the opinion that\nthis change will facilitate the execution of the new strategy for the Fund.\nThe sale of JW Aluminum is expected to reduce our average senior debt\nlevels to approximately 1.7 times EBITDA and average total debt to 3.0 times\nEBITDA. Following the sale of JWA and given our current outlook for the\nremaining businesses, we expect to continue to maintain our current\ndistribution level of $0.13 per month, or $1.56 annualized, which is expected\nto place our payout ratio for 2007 for the remaining businesses at\napproximately 90% of distributable cash flow.\nWe have entered into an underwriting agreement with two of our bank\nlenders to restructure some of our debt facilities to enhance debt flexibility\nand increase liquidity during the implementation of the strategic ...