Coventree Announces Continued ABCP Market Disruption



    Toronto Stock Exchange Symbol: COF

    TORONTO, Aug. 16 /CNW/ - Coventree Inc. (TSX: COF) today announced that
its conduits did not place any liquidity-backed asset backed commercial paper
("ABCP") (liquidity-backed ABCP is also known as A notes) and that extendible
ABCP (also known as E notes) was placed in the aggregate amount of
$13 million. These E notes were purchased by investors that elected to renew
or roll-over their ABCP that matured today. In aggregate, approximately
$268 million of A notes and $59 million of E notes issued by Coventree's
conduits matured today. Coventree does not know the extent to which this
failure to place the remainder of its maturing ABCP was a result of the
continuing ABCP market disruption that began on August 13, 2007 or of
continuing technical difficulties at the depositary for its conduits' ABCP
that prevented the processing of orders to purchase such ABCP. Again today,
certain investors in ABCP issued by Coventree-sponsored conduits that matured
today advised Coventree that attempts to roll-over maturing ABCP into new ABCP
in Coventree's conduits were unsuccessful. Accordingly, Coventree is unable to
assess today's investor demand for its conduits' ABCP.
    While Coventree sponsors and administers these ABCP conduits, the ABCP
issued by them are not obligations of Coventree or guaranteed by Coventree.
The conduits are separate legal entities and the ABCP issued by the conduits
is non-recourse to Coventree.
    Coventree also reported that DBRS announced today that it had placed its
ratings of ABCP issuers affected by the current market disruption, including
Coventree's conduits, "Under Review with Developing Implications" as a result
of the events of this week. DBRS stated that in its view, if the current
situation were to continue beyond prescribed grace periods, "the underlying
assets (held by the ABCP conduits) would be liquidated and, depending on the
individual issuer, it is likely that noteholders would experience a loss."
According to DBRS, these losses would arise because "some of the underlying
assets, although strong from a credit perspective, could fetch significantly
less than par" due to the extreme levels of volatility in the global credit
markets.
    At this time, the Company continues to be unable to predict the extent of
the impact of this market disruption on Coventree's financial results,
operations, and financial condition including any impairment of assets in
future periods. The current market disruption will adversely affect and may
materially adversely affect the future revenues of the Company. Coventree is
still unable to predict how long the current market disruption will continue
or the extent to which the market disruption will affect the conduits' ability
to raise funds to continue to finance their operations.

    Forward-Looking Statements

    This press release includes certain forward-looking statements, including
those identified by the expressions "may", "would", "could", "will",
"anticipate", "believe", "plan", "forecast", "estimate", "expect", "intend",
"aim", "vision", "mission", "endeavour" and similar expressions to the extent
they relate to Coventree or its leaders or management ("leaders"). The
forward-looking statements are not historical facts but reflect such leaders'
current expectations regarding future results or events based on information
currently available to the leaders.
    These forward-looking statements are subject to a number of known and
unknown risks, uncertainties and assumptions. Many factors could cause actual
results, performance or events to differ materially from current expectations
that may be expressed or implied by such forward-looking statements,
including, without limitation, the matters discussed under "Risk Factors"
contained on pages 58 to 65 of the Company's Final Prospectus dated November
15, 2006 and in other sections herein and therein. Should one or more of these
risks or uncertainties materialize, or should assumptions underlying the
forward-looking statements prove incorrect, actual results, performance or
achievements could vary materially from those expressed or implied by the
forward-looking statements contained in this report. These factors should be
considered carefully and prospective investors should not place undue reliance
on the forward-looking statements. Although the forward-looking statements
contained in this report are based upon what the Company's leaders currently
believe to be reasonable assumptions, the leaders cannot assure prospective
investors that actual results, performance or achievements will be consistent
with these forward-looking statements. These forward-looking statements are
made as of the date of this report and the Company does not intend, and does
not assume any obligation, to update or revise these forward-looking
statements.

    %SEDAR: 00024386E




For further information:

For further information: Craig Armitage, The Equicom Group Inc., Tel:
(416) 815-0700 x278, Email: carmitage@equicomgroup.com

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Coventree Inc.

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