Jan. 12 - ALE.TSE -Sleeman Breweries Ltd. Makes Offer to Acquire The Upper Canada Brewing Company Limited
Via: 207.183.153.23
GUELPH, ONTARIO--Sleeman Breweries Ltd., Canada's leading premium
craft brewer, today announced its intention to join forces with
The Upper Canada Brewing Company Limited, in what will be the most
significant combination ever of two craft brewers in Ontario.
Sleeman will make an offer to purchase all the outstanding common
shares of Upper Canada for a total price of $2.75 cash plus 0.433
of a common share of Sleeman for each share of Upper Canada. The
offer is conditional upon, among other things, at least 90 per
cent of the shares (other than shares already held at the date of
the offer by Sleeman) being validly deposited under the offer and
not withdrawn, and regulatory approval.
"Currently, small craft brewers are faced with increased business
pressures in the highly competitive brewing industry. The
solution for a number of these brewers has been to consolidate, to
reduce overhead and increase profitability," says John Sleeman,
chairman, Sleeman Breweries Ltd. "For Sleeman, the timing
couldn't have been better for the proposed merger. We share the
same vision and, as a result, the continuing companies will be
considerably stronger and better positioned within the premium
beer category. We intend to use this strength to aggressively
support Upper Canada's brands to ensure that their drinkers
continue to enjoy the beers they have appreciated throughout the
past thirteen years."
If the offer is successful, it is the intention of Sleeman to
close Upper Canada's Toronto plant. Sleeman Breweries Ltd. will
then continue to brew Upper Canada products in its Guelph brewery
with the same quality, ingredients and methods with which the
Upper Canada beers have been traditionally brewed.
While overall beer industry trends are flat, the craft brewing
category continues its long term growth trend, up approximately 12
per cent, as compared with a year ago. This growth is largely
fueled by the category leader, Sleeman Breweries Ltd., with annual
growth of 20 per cent.
"This initiative will solidify our leadership role and position us
as the specialist within this growth category," adds Sleeman. "We
will also benefit from greatly enhanced efficiencies and a
significantly enhanced portfolio of brands."
The offer is being made pursuant to an agreement dated today
between Sleeman and Upper Canada and certain shareholders,
pursuant to which, subject to certain conditions including a
positive recommendation of The Upper Canada Board, Sleeman has
agreed to make or cause a subsidiary to make an offer to purchase
all shares. Certain Upper Canada shareholders including Gerry
Hurlow and Terry Smith have agreed to deposit under the offer all
shares held by them (representing approximately 14 per cent of the
outstanding shares). In addition, Sleeman owns approximately 7
per cent of the outstanding shares of Upper Canada.
Subject to the satisfaction of certain conditions, a take-over bid
circular containing the details of the offer is expected to be
mailed to all registered security holders of Upper Canada by
January 31, 1998.
Founded in 1984, The Upper Canada Brewing Company was one of the
first microbreweries to be established in Canada. The brewery
produces all natural bottled and draft beers. Selected brands
include Upper Canada Lager, Upper Canada Dark Ale and Upper Canada
Rebellion Lager.
Sleeman Breweries Ltd. is Canada's largest craft brewer of premium
beers. Founded in 1834 and reactivated in 1985 by chairman John
W. Sleeman, the brewery produces all natural bottled and draft
beer marketed under its own name. Sleeman brands include Sleeman
Cream Ale, Sleeman Honey Brown Lager, Sleeman Silver Creek Lager
and Sleeman Original Dark. Additionally, Sleeman's Okanagan
Spring Brewery produces the best-selling premium craft beer in
British Columbia. Okanagan brands include Okanagan Pale Ale,
Honey Blonde Ale and Autumn Red Ale.
Media: John Sleeman, chairman, Sleeman Breweries Ltd. will be
available for interviews. For more information or to arrange an
interview, contact Susan Willemsen or Carol Panasiuk at Cohn &
Wolfe. Tel: (416) 924-5700 Email:
susan_willemsen@CohnWolfe.com
Financial Analysts: John Sleeman will be available for a
conference call today at 11:10 a.m. To participate, dial
1-888-575-8230. Provide operator with your name and reference #
TCA4Sleeman.
FOR FURTHER INFORMATION PLEASE CONTACT:
Cohn & Wolfe
Susan Willemsen
(416) 924-5700
Email: susan_willemsen@CohnWolfe.com
or
Cohn & Wolfe
Carol Panasiuk
(416) 924-5700
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