E.D. Smith Income Fund to acquire Seaforth Creamery

21/04/06 E.D. Smith Income Fund has announced that it has entered into an agreement to indirectly acquire the assets of Seaforth Creamery Inc. (“Seaforth”), a privately owned company. Seaforth is the largest producer of private label pourable and spoonable salad dressings in Canada, and has a significant presence in both categories in the U.S. with revenue and Adjusted EBITDA in fiscal 2005 of approximately $106 million and $13.9 million, respectively.

“The combined business will build on a reputation for bringing innovative, low cost, best in category products to its valued customers to the benefit of its employees and unitholders,” said Ed Barr, Co-Chairman of Seaforth. Mr. Barr will join the Board of Trustees of E.D. Smith Income Fund (“Fund”) and will be active in the combined business through a consulting arrangement. Mark Barr, President and Co-Chairman of Seaforth, will become Executive Vice President Sales & Marketing of the combined business. Through this transaction the Barr family will indirectly become a substantial unitholder of the Fund.

Under the terms of the agreement, the Fund has agreed to pay $95.2 million, consisting of $76.6 million in cash and $18.6 million in securities exchangeable for units of the Fund, on a one-for-one basis, subject to certain terms and conditions. The Fund has agreed to make an additional payment in cash and/or units of the Fund only payable upon the achievement of pre-determined thresholds of 2006 Adjusted EBITDA. The transaction is expected to close on May 12, 2006 and is subject to customary closing conditions. The Fund expects to finance the cash portion of the acquisition price through a combination of debt and equity. BMO Nesbitt Burns has been retained to advise on financing the transaction.

Seaforth is a privately owned, leading North American manufacturer of private label pourable salad dressings, spoonable salad dressings (which include whipped dressings and mayonnaise), and marinades. The Company, founded in 1914, has more than 280 employees, with manufacturing facilities in Seaforth, Ontario and Cambridge, Ontario.

E.D. Smith Income Fund is an unincorporated, open-ended, limited purpose trust that owns E.D. Smith & Sons, Limited and its subsidiaries. E.D. Smith is a leading manufacturer of a broadly diverse portfolio of high quality branded and private label food products. E.D. Smith, founded in 1882, markets and distributes its products to the food retail and foodservice markets in Canada and the U.S. The Company’s products range from fruit-based products, which include jams (including preserves, jellies, marmalades and spreads), pie fillings, and ketchup, to sauces, which include pasta sauces, salsa, barbeque sauces, specialty sauces and syrups, to oil-based products, which include pourable salad dressings and marinades.

http://www.goodmedia.com/equicom/edsmith/ir/documents/JAMApril202006Project_Spoon_acquisition_FINAL_000.pdf