VANCOUVER, Feb. 23, 2018 /CNW/ - A&W Food Services of Canada Inc. ("Food Services") and A&W Revenue Royalties Income Fund (the "Fund") (TSX: AW.UN), announced today that A&W of Canada Inc. ("A&W Canada"), the parent company of Food Services, has completed a reorganization (the "Reorganization") to provide liquidity for, and accommodate the individual estate planning purposes of, some of its long standing shareholders. As part of the Reorganization, several shareholders of A&W Canada have collectively sold a significant minority, indirect ownership interest in Food Services to funds managed by TorQuest Partners. A&W Canada will retain a 100% interest in all the securities exchangeable into units of the Fund (the "Royalty Securities") currently owned by Food Services and any additional Royalty Securities acquired by Food Services as a result of the addition of new stores to the royalty pool in respect of which royalties are paid by Food Services to the Fund until December 31, 2022.
The Reorganization does not constitute a change of control of Food Services, as existing shareholders will continue to maintain majority control of Food Services. There will also be no change in management or operations of the Food Services' business in connection with the Reorganization. The current shareholders of A&W Canada will retain the right to elect three of the five members of the board of directors of Food Services. Michael Hollend and Eric Berke, have been appointed as members of the board of directors of Food Services replacing Axel Rehkatsch and Bill Levine.
As noted, this Reorganization has enabled A&W Canada to realize liquidity for certain of its long-standing shareholders for their individual estate planning purposes, while welcoming a well-respected Canadian fund manager to Food Services' shareholding group.
The A&W Revenue Royalties Income Fund is a limited purpose trust established to invest in A&W Trade Marks Inc., which through its interest in A&W Trade Marks Limited Partnership (the Partnership), owns the A&W trade-marks used in the A&W quick service restaurant business in Canada. The A&W trade-marks comprise some of the best-known brand names in the Canadian foodservice industry. In return for licensing Food Services to use its trade-marks, Trade Marks (through the Partnership) receives royalties equal to 3% of the sales of A&W restaurants in the Royalty Pool.
A&W Food Services of Canada Inc. is 100 per cent Canadian owned and is one of the strongest brand names in the Canadian foodservice industry. A&W is the nation's second largest hamburger restaurant company with 920 locations coast-to-coast. A&W Restaurants feature famous trade-marked menu items such as The Burger Family®, Chubby Chicken®, and A&W Root Beer®. For more information, please visit www.aw.ca.
For additional information about TorQuest Partners see their website at http://www.torquest.com.
SOURCE A&W Revenue Royalties Income Fund
For further information: Don Leslie, Chief Financial Officer, A&W Food Services of Canada, (604) 988-2141; Nancy McHarg, Hoggan & Associates, (604) 760-4366