BOUCHERVILLE, April 28 /CNW Telbec/ - Spectra Premium Industries Inc.
(TSX: SPD.sv), a North American leader in the manufacture of automobile, light-
truck and heavy-duty truck aftermarket parts and manufacturer of high-pressure
die cast magnesium alloy parts and steel fuel tanks in the Original Equipment
Manufacturer ("OEM") market, announces the signature of an agreement in
principle to proceed with a $44 million sale and leaseback transaction
involving an overseas institutional investor and GE Commercial Finance.
This transaction covers the buildings located in Boucherville and Laval.
By virtue of this agreement, Spectra Premium will sell these two buildings for
a total amount of $44 million and sign 20-year leases for each of these
buildings. The proceeds from the sale of these buildings will be entirely used
to reduce the bank indebtedness of Spectra Premium.
"This transaction will have a very positive impact on our balance sheet
and will provide additional financial flexibility of which we will benefit
from. This transaction will also facilitate the financing of our current and
future expansion plans," indicated Mr. Denis Poirier, CA, Executive Vice-
President and Chief Financial Officer of Spectra Premium.
In terms of impact on income, the gain of about $5 to $6 million
resulting from the disposal of these buildings will be amortized on the lease
terms. In addition, the transaction will result in a reduction of annual
interest, amortization and capital tax expenses that will exceed by
approximately $750,000 the amount of additional rent expenses reduced by the
amortization of the gain on disposal.
This transaction is conditional upon a customary due diligence audit and
approval from the banking syndicate of Spectra Premium and is scheduled to
close around June 1st, 2005.
PROFILE
Spectra Premium is the world leader in the manufacture of steel fuel
tanks and related components for the automobile and light-truck aftermarkets.
The Corporation ranks first in Canada and is a North American leader in the
aftermarket for automotive and industrial radiators, radiator components and
new and reconditioned oil pans. It also maintains a presence in such markets
as sending units, fuel pumps, body panels, condensers, compressors, complete
heater cores and other air-conditioning parts. Over the past years, the
Corporation expanded its activities in the OEM market by concluding automotive
agreements to supply steel fuel tanks and aluminum radiators and in addition,
to supply radiators for industrial applications and heavy equipment. The
Corporation has increased its presence in the OEM segment, following the
recent acquisition of Trimag, one the most important North American
manufacturers of high-pressure die cast magnesium alloy parts. It currently
employs approximately 1,600 people in its nine (9) plants and 58 distribution
centers, which are located throughout Canada, the United States and Europe.
Its shares are traded on the Toronto Stock Exchange (ticker symbol: SPD.sv).
PROSPECTIVE FINANCIAL INFORMATION
This press release contains implicit or explicit forecasts, as well as
forward-looking statements on the objectives, strategies, financial
position, operating results and activities of Spectra Premium. These
statements are forward-looking to the extent that they are based on
expectations relative to markets in which the Corporation exercises its
activities and on various assessments and assumptions. These expectations
seemed reasonable to us at the time when this press release was diffused.
Our actual results could however differ significantly from management's
expectations if recognized or unrecognized risks affect our results or if
our assessments or assumptions are inaccurate. That is why we cannot
guarantee the realization of these forward-looking statements. You will
find in the annual report on page 26 a non exhaustive presentation of
risks which could result in an important variance between our actual
results and our actual expectations, which can be consulted on the
following websites: http://www.sedar.com and
http://www.spectrapremium.com/ .
