Liquor Barn Income Fund rejects unsolicited offer by Liquor Stores Income Fund

    EDMONTON, April 10 /CNW/ - Liquor Barn Income Fund (TSX: LBN.UN) ("Liquor
Barn" or the "Fund"), a leading operator of private liquor stores in Western
Canada, today confirmed that Liquor Stores Income Fund ("Liquor Stores") has
commenced an unsolicited offer to purchase all of the issued and outstanding
units of the Fund. In accordance with the offer, Liquor Barn unitholders would
receive 0.53 of a unit of Liquor Stores for each unit of Liquor Barn. Liquor
Barn's Board of Trustees unanimously recommends that Liquor Barn unitholders
reject the Liquor Stores unsolicited takeover bid and not tender their units
to the offer.
    The terms of the Liquor Stores offer remain unchanged from a prior
proposal made to Liquor Barn by Liquor Stores in February 2007. Liquor Barn
rejected the prior proposal following the results of a thorough review by
management, the Board of Trustees and Liquor Barn's financial advisors. After
reviewing today's offer by Liquor Stores, Liquor Barn's independent Board of
Trustees continues to believe that the consideration contemplated by the
Liquor Stores offer is inadequate and not in the best interests of Liquor Barn
unitholders in light of Liquor Barn's ongoing growth prospects and the
significant synergies that Liquor Stores would enjoy from acquiring Liquor
Barn. In addition, because the consideration under the Liquor Stores offer
consists entirely of Liquor Stores units, the value of the Liquor Stores offer
is less certain than a cash bid.
    "We regard the Liquor Stores offer to be inadequate and opportunistic, as
it fails to recognize Liquor Barn's further growth potential and the financial
and operational benefits and synergies to be realized as a result of combining
the two Funds," said Dr. John Mather, President and CEO, Liquor Barn GP Inc.
"Liquor Barn has retained TD Securities Inc. as its financial advisor. In the
meantime, Liquor Barn intends to continue executing on its growth strategy,
including the deployment of funds raised in our $33.4 million bought deal
financing, which closed earlier today."
    Following further review, consideration and evaluation of today's offer
by Liquor Stores, Liquor Barn's Board of Trustees will issue and file with
Canadian securities commissions a Directors' Circular that will contain
important information for unitholders to read, including the Board of
Trustee's formal recommendation regarding the offer.
    Given the unsolicited nature of the offer by Liquor Stores and the
limited time Liquor Barn will have to respond to it, as well as the time
required to consider alternative courses of action, the Board of Trustees is
also considering the advisability of implementing a Unitholders' Rights Plan.
The Board intends to update unitholders regarding this and other developments
in the coming days.

    About Liquor Barn
    Liquor Barn Income Fund is a publicly traded Canadian income fund that
owns a 72.4% interest in Liquor Barn Limited Partnership ("Liquor Barn LP").
Liquor Barn LP, which currently operates 61 liquor stores in Alberta and 10 in
British Columbia, is a leading operator of private liquor stores in Western
Canada. Liquor Barn's units trade on the Toronto Stock Exchange under the
symbol LBN.UN. Additional information about Liquor Barn Income Fund is
available at or

    Forward-Looking Statements
    This news release contains forward-looking statements. These statements
relate to future events or future performance and reflect the expectation of
the Fund regarding its growth, results of operations, performance and business
prospects, and opportunities and trends affecting the retail liquor industry.
Such forward-looking statements reflect current beliefs of management and are
based on information currently available. Prospective investors can identify
many of these statements by looking for words such as "believe", "expects",
"will", "intends", "projects", "anticipates", "estimates", "continues" or
similar words or the negative of these or other comparable terminology. A
number of factors could cause actual events or results to differ materially
from the events or results discussed in such forward-looking statements.
Although management believes that the expectations represented in such
forward-looking statements are reasonable, there can be no assurance that such
expectations will prove to be correct. Any forward-looking statements included
in this news release are made as of the date of this news release and the Fund
assumes no obligation to update or revise them to reflect new events or

    %SEDAR: 00023526E

For further information:

For further information: Dr. John Mather, Chief Executive Officer,
Liquor Barn GP Inc., (780) 462-0190 ext 315; Richard N. Hughes, Chief
Financial Officer, Liquor Barn GP Inc., (780) 462-0190 ext 310; FOR MEDIA
INQUIRIES CONTACT: Craig Armitage or Kristen Dickson, Investor Relations, The
Equicom Group (416) 815-0700

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