STE-MARIE DE BEAUCE, QC, June 25 /CNW Telbec/ - (Note: All amounts are in
Canadian dollars.) GBO INC. ("GBO" or the "Company"; TSX Venture Exchange:
GBO) announces that it has entered into an agreement with Farley WinDoor Ltd.
("Farley"), a window and door manufacturer based in Alexandria, Ontario,
pursuant to which Farley will acquire all of the operating assets and related
inventories of GBO's divisions specializing in the manufacture, selling and
distribution of PVC windows (St-Joseph-de-Beauce, Quebec plant) and steel
doors (Lévis, Quebec plant). The transaction is expected to close in July of
2009. GBO will receive an aggregate cash payment of $12.5 million, payable as
follows: (i) $500,000 non-refundable deposit which was paid on May 29, 2009;
(ii) $11,000,000 at closing; and (iii) $1,000,000 upon the 12-month
anniversary of the closing, which amount will bear interest. GBO intends to
use a significant portion of the proceeds of the transaction to pay down its
currently outstanding debt.
Upon the completion of the transaction, GBO will continue its operations
as a manufacturer of wood windows, doors and wood accessories. Shareholders
holding an aggregate of nearly 90% of the issued and outstanding common shares
of GBO have approved the transaction by way of consent letters.
A fee of $400,000 will be paid to Beringer Capital Inc. in consideration
for their services related to the transaction. All parties to the transaction
are at arm's length.
GBO's Chairman of the Board of Directors, Christopher Wood, said he is
pleased with this transaction which reflects both companies' positioning
strategies while respecting the interests of customers and employees.
Mr. Wood also pointed out that this transaction fits into the strategy
initiated by GBO in recent years to further concentrate on its core mission
and its primary expertise as a manufacturer of high-end wood window
arrangements, doors and their accesories. "Over the past two years, in
particular, we have invested substantially to completely reorganize and
optimize the manufacturing operations of our Ste-Marie de Beauce (Quebec)
plant, to equip this facility with cutting-edge equipment and to develop
several new products. In fact, the broadening of our selection of
architectural wood products not only underpins our leadership in Eastern
Canada, but also spearheads our development strategy in the United States,
which is an essential component of GBO's long-term strategy. This return to
basics will enable us to focus the bulk of our resources and investments on
our field of excellence, which is especially advantageous as the barriers to
entry into the wood product segment are higher than into other categories of
"The transaction with Farley is also financially beneficial to GBO.
First, it enables us to achieve an accretive return on the investments made in
the past years to upgrade and improve the St-Joseph and Lévis facilities.
Secondly, it further strengthens our balance sheet, which will give us greater
leverage to continue investing in the continuous improvement of our selection
of architectural wood products and customer service, as well as in the
development of our Canadian and U.S. markets."
Founded in 1946, GBO Inc. is one of the leading window and door
manufacturers in Eastern Canada. The Company, which employs approximately 500
people, designs, develops, manufactures, markets and distributes an extensive
selection of high-end energy-efficient window arrangements sold primarily
under the "Bonneville" and "Polar" brands. This selection includes wooden and
polyvinyl chloride (PVC) windows, as well as hybrid models made of wood or PVC
and aluminum. Recently, GBO launched a line of innovative fenestration
products resistant to hurricanes and other impacts. GBO also offers exterior
doors, primarily for high-end market niches. The Company sells its windows and
doors to the home improvement and construction markets in Quebec, Ontario, the
Maritimes and the Eastern United States. GBO mainly serves independent
building material distributors, distributors specializing in windows, doors
and millwork, certain retailers, as well as construction and renovation
The statements set forth in this press release that describe GBO's
objectives, projections, estimates, expectations or forecasts may constitute
forward-looking statements within the meaning of securities legislation. GBO
would like to point out that, by their very nature, forward-looking statements
involve a number of risks and uncertainties such that actual results or the
measures it adopts could therefore differ materially from those indicated or
underlying these forward-looking statements, or could have an impact on the
degree of realization of a particular projection. There can be no assurance as
to the materialization of the results, performance or achievements as
expressed or implied by the forward-looking statements. Unless required to do
so pursuant to applicable securities legislation, GBO's management assumes no
obligation as to the updating or revision of the forward-looking statements as
a result of new information, future events or other changes.
Neither TSX Venture Exchange nor its Regulation Services Provider (as
that term is defined in the policies of the TSX Venture Exchange) accepts
responsibility for the adequacy or accuracy of this release.
For further information:
For further information: Christopher Wood, Chairman of the Board of
Directors, (418) 387-7723; Source: GBO Inc.