TSX: SPF.UN
CALGARY, June 13 /CNW/ - Superior Plus Income Fund (the "Fund") announced today that its wholly owned indirect subsidiary Superior Energy Management Electricity LP ("SEM") is entering the high growth fixed price retail electricity market in Ontario and has entered into a long term electricity supply agreement with Bruce Power L.P. ("BPLP"), Ontario's largest independent electricity generator.
Under the agreement, BPLP has agreed to supply electricity ("Supply") to support SEM's fixed priced customer contracts in the Ontario market. The deal is structured with an initial term of three years and may renew annually thereafter. During the term of the agreement, SEM will purchase Supply from BPLP for customer contract terms of up to five years and the obligation to provide Supply for the term of such contracts will survive the termination of the agreement.
Electricity sales will be made by existing sales channels allowing for greater channel productivity and increased revenue per customer. As SEM enters these new business channels, they will incur start-up costs in the initial period and realize enhanced cash flow as they begin delivering to their customers. These costs and cash flow are within their operating distributable cash flow guidance of $12 - $15 million for 2007, and $15 - $18 million for 2008.
"Today's announcement represents another key component of our strategy to grow and diversify our business", said Greg McCamus, President of SEM. "We will be leveraging our strong presence in the Ontario gas market by bringing new innovative electricity price protection plans to Ontario residential consumers and small businesses. In addition, on May 1 2007, we successfully expanded into the newly deregulated British Columbia residential gas market as part of our organic growth initiative."
Grant Billing, CEO Superior Plus stated: "We are very pleased to be entering the electricity market and expanding our natural gas business into the new BC market with our highly experienced team at Superior Energy Management. Penetration of these strong markets is expected to allow the Fund growth opportunities resulting in greater stability of its distributions and increased unitholder value over the long term."
About Superior Plus and the Fund
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Superior Plus Income Fund is a diversified business trust. The Fund holds 100% of Superior Plus LP, a limited partnership formed between Superior Plus Inc., as general partner and the Fund as limited partner. Superior Plus is focused on stability of distributions with value growth and has four Canadian based operating divisions: Superior Propane is Canada's largest distributor of propane, related products and services; ERCO Worldwide is a leading supplier of chemicals and technology to the pulp and paper industries, a regional Midwest supplier of chloralkali products and the third largest producer of potassium products in North America; Winroc is the seventh largest distributor of walls and ceilings construction products in North America; and Superior Energy Management provides fixed price natural gas supply services in British Columbia, Ontario and Quebec and fixed price electricity supply services in Ontario.
The Fund's trust units and convertible debentures trade on the Toronto Stock Exchange as follows
Trading Symbol Security Issued and Outstanding ------------------------------------------------------------------------- SPF.un Trust Units 86.1 million SPF.db 8% Debentures, Series 1 $8.1 million principal amount SPF.db.a 8% Debentures, Series 2 $59.0 million principal amount SPF.db.b 5.75% Debentures, Series 1 $174.9 million principal amount SPF.db.c 5.85% Debentures, Series 1 $75.0 million principal amount -------------------------------------------------------------------------