VenGrowth Funds back Genesis Capital to acquire Ultramatic, supplier of hi-tech beds



    VenGrowth investment supports succession plan for founders of Canada's
    largest adjustable bed company

    TORONTO, March 1 /CNW/ - VenGrowth Private Equity Partners Inc. and its
affiliates ("VenGrowth"), a leading private equity firm with over $1 billion
in assets under management, today announced a $4.5 million investment in
Ultramatic Sleep of Canada ("Ultramatic"). The financing was led by the
VenGrowth Traditional Industries Group.
    The VenGrowth Traditional Industries Fund Inc., The VenGrowth III
Investment Fund Inc., and VG Mezzanine I Limited Partnership provided a
subordinated loan to facilitate the acquisition of control of Ultramatic by
the principals behind Genesis Capital Corporation ("Genesis Capital"). The
VenGrowth investment includes an equity position in Ultramatic. Financing was
also provided by Royal Bank of Canada.
    Ultramatic distributes electric adjustable beds and accessories such as
headboards, sheets and bed rails. Ultramatic's beds include luxury features
such as built-in heat systems and massage capabilities, all geared to
comfort-seeking consumers.
    Ultramatic was purchased from the husband and wife team of Ron and Donna
Peterson, who founded the company nearly 25 years ago. The deal highlights
VenGrowth's ability to support entrepreneurs towards a well thought-out
succession plan leading to a rewarding exit of the business.
    Paul Massara, President of Genesis Capital and Martin Philp, Managing
Partner of Genesis Capital, led the transaction to acquire Ultramatic. Mr.
Philp will become interim President & CEO of Ultramatic, with Genesis Capital
continuing to provide managerial expertise to Ultramatic.
    "The Genesis Capital management team possesses a wealth of experience in
growing businesses and driving profits," said Graham McBride, Managing General
Partner, VenGrowth. "Ultramatic has established a market niche in supplying
electric adjustable beds across North America, and will continue to thrive
with Marty and Paul's guidance."
    "VenGrowth was a key partner in the Ultramatic acquisition, providing us
not only with financing, but also with expertise," said Martin Philp, interim
President & CEO of Ultramatic. "We structured the transaction together, and
will continue to work together with the mutual goal of building on
Ultramatic's reputation as a world-class provider of electric adjustable
beds."
    Ultramatic's target market of customers 50 years or older, is supported
by aging demographics in North America. Trends also suggest consumers are
shifting to specialty products offering health benefits, like Ultramatic's
leading sleep systems.

    About VenGrowth Traditional Industries Group

    VenGrowth Traditional Industries Group specializes in financing solutions
for mid-market Canadian companies in traditional manufacturing and services
industries that are expected to generate sustainable cash flows. The Group
primarily invests using debt instruments with the objective of generating
interest and dividend income to participating VenGrowth Funds. In addition,
the Funds will typically hold equity interests alongside the loans with the
intention of generating long-term capital appreciation. Formed in 2003, the
Group had invested over $117 million into 16 companies as at January 31, 2007.
The Group is led by Graham McBride, a highly regarded mezzanine financing
expert with over 19 years of experience.

    About VenGrowth

    With over $1 billion in assets under management, VenGrowth is Canada's
largest private equity and venture capital firm managing both retail and
institutional assets. Since 1982, VenGrowth's accomplished private equity
managers have invested over $1.1 billion in over 180 companies, building a
strong track record of successful portfolio transactions. These investments
have been made on behalf of over 180,000 individual investors and leading
pension funds, banks, insurance companies and family foundations. Portfolio
companies benefit from VenGrowth's substantial experience, resources, and
hands-on investment style. VenGrowth's offices are located in Toronto
(Corporate Headquarters) and Ottawa. For more information, please visit
www.vengrowth.com.

    About Genesis Capital

    Toronto-based Genesis Capital is a private equity company focusing on the
acquisition of traditional industrial businesses. By forging strong
partnerships, Genesis provides both capital and hand-on operational
management. For more information, please visit www.genesiscapitalcorp.com

    About Ultramatic

    Based in Burlington, Ontario, Ultramatic supplies high quality electric
adjustable beds directly to consumers. With over 130 employees it has numerous
locations across Canada as well as in the US. Backed by impressive warranties,
the company's beds have luxury features such as remote controls to move the
head and foot sections, as well as incorporated massage and heat systems. For
more information, please visit www.ultramaticsleep.com





For further information:

For further information: Angus Fisher, Manager, Media & Communications,
VenGrowth Asset Management Inc., (416) 628 9255, afisher@vengrowth.com

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VENGROWTH PRIVATE EQUITY PARTNERS INC.

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