H.I.G. Capital Buys Arctic Glacier Out of Bankruptcy

Arctic Glacier Income Fund is to sell its business and assets to an affiliate of Miami-based H.I.G. Capital. Arctic Glacier is a producer, marketer and distributor of packaged ice in North America, primarily under the brand name of Arctic Glacier Premium Ice.


Arctic Glacier Income Fund (cnsx:AG.UN) (“Arctic Glacier”) announced today that it has entered into a binding agreement (the “Agreement”) to sell substantially all of its business and assets (the “Transaction”) to an affiliate of H.I.G. Capital (the “Purchaser”), a prominent private equity investment fund headquartered in Miami, Florida. The Purchaser submitted its proposal in accordance with Arctic Glacier’s court approved Sale and Investor Solicitation Process (“SISP”) under the Companies’ Creditors Arrangement Act (Canada) (the “CCAA”).
Alvarez & Marsal Canada Inc., the CCAA Court-appointed monitor (the “Monitor”), recommended, after consultation with Arctic Glacier’s financial advisor, TD Securities Inc., the Chief Process Supervisor and Arctic Glacier, the Qualified Bid (as defined in the SISP) submitted by the Purchaser as the most favourable Qualified Bid and that it should be selected. The Special Committee of Arctic Glacier’s Board of Trustees accepted the Monitor’s recommendation in accordance with the SISP.
The Agreement and completion of the Transaction remain subject to court approval in Canada and the United States, pre-merger clearance in the United States, and the satisfaction of certain closing conditions customary in transactions of this nature, including the absence of a material adverse change in respect of Arctic Glacier. The Purchaser has arranged committed financing for the completion of the Transaction, which is expected to close by July 31, 2012.
Upon completion of the Transaction, Arctic Glacier will be a financially stronger company that is well positioned for growth. The Purchaser intends to partner with senior management of Arctic Glacier to implement growth initiatives that will enhance profitability and increase the value of the business. On closing, all Arctic Glacier employees will be offered employment and the company’s head office will remain in Winnipeg. The Agreement provides that the Purchaser will assume Arctic Glacier’s current trade payables, its leases and certain contractual obligations. Arctic Glacier’s existing secured lenders will be paid in full on closing. Arctic Glacier expects that the net proceeds of the sale will be sufficient to pay all of its remaining known creditors and may be sufficient to permit a distribution to its unitholders after all creditor claims have been proven and satisfied. The timing and amount of any distributions to be paid to creditors and unitholders cannot be determined at this time.
Keith McMahon, President and CEO of Arctic Glacier, commented, “this transaction is the result of the tremendous effort and dedication of our employees who should be proud of their efforts. We look forward to working with H.I.G. to complete this sale, which we expect will put us in a strong competitive position to grow our business and strengthen our position as an industry leader in the packaged ice business.”
Forward-Looking Statements
Certain statements included herein constitute “forward-looking statements”. All statements, other than statements of historical fact, included in this release that address future activities, events, developments or financial performance are forward-looking statements. These forward-looking statements can be identified by the use of forward-looking words such as “may”, “should”, “will”, “could”, “expect”, “intend”, “plan”, “estimate”, “anticipate”, “believe”, “future” or “continue” or the negative thereof or similar variations. In particular, statements about the proposed Transaction between H.I.G. and Arctic Glacier, including the expected timetable for completing the Transaction, the receipt of court and other approvals, the anticipated outcomes of the Transaction set out in paragraph 4 hereof and any other statements regarding H.I.G. and Arctic Glacier’s future expectations, beliefs, goals or prospects are or involve forward-looking information. These forward-looking statements are based on certain assumptions and analyses made by Arctic Glacier and its management, in light of their experiences and their perception of historical trends, current conditions and expected future developments, as well as other factors they believe are appropriate in the circumstances. Investors are cautioned not to put undue reliance on such forward-looking statements, which are not a guarantee of performance and are subject to a number of uncertainties, assumptions and other factors, many of which are outside the control of H.I.G. and Arctic Glacier, which could cause actual results to differ materially from those expressed or implied by such forward-looking statements. Important factors that could cause actual results to differ materially from those expressed or implied by such forward-looking statements include, among other things, the parties’ ability to consummate the Transaction; the parties’ ability to satisfy the conditions to the completion of the Transaction, including that the receipt of court approval, or regulatory approval for the Transaction may not be obtained, or may not be obtained on the terms expected or on the anticipated schedule; general economic and market factors (including changes in global, national or regional financial, credit, currency or securities markets), changes or developments in global, national or regional political conditions (including any act of terrorism or war), changes in government laws or regulations (including tax laws) and changes in GAAP or regulatory accounting requirements.
Readers are cautioned that the foregoing lists are not exhaustive. Such forward-looking statements should, therefore, be construed in light of such factors. If any of these risks or uncertainties were to materialize, or if the factors and assumptions underlying the forward-looking information were to prove incorrect, actual results could vary materially from those that are expressed or implied by the forward-looking information contained herein. All forward-looking statements attributable to Arctic Glacier, or persons acting on its behalf, are expressly qualified in their entirety by the cautionary statements set forth above. Readers are cautioned not to place undue reliance on forward-looking statements contained herein, which reflect the analysis of the management of Arctic Glacier, as appropriate, only as of the date of this release. For more information regarding these and other risks, readers should consult Arctic Glacier’s reports on file with applicable securities regulatory authorities accessible online by going to SEDAR at www.sedar.com or by going to the Arctic Glacier website at www.arcticglacier.com . Arctic Glacier is under no obligation, and Arctic Glacier expressly disclaims any intention or obligation, to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law.
About Arctic Glacier
Arctic Glacier Income Fund, through its operating company, Arctic Glacier Inc., is a leading producer, marketer and distributor of high-quality packaged ice in North America, primarily under the brand name of Arctic Glacier(R) Premium Ice. Arctic Glacier operates 39 production plants and 47 distribution facilities across Canada and the northeast, central and western United States servicing more than 75,000 retail locations.
Arctic Glacier Income Fund trust units are listed on the Canadian National Stock Exchange under the trading symbol AG.UN. There are 350.3 million trust units outstanding.
About H.I.G. Capital
H.I.G. is a leading global private equity investment firm with more than $8.5 billion of equity capital under management. Headquartered in Miami, and with offices in Atlanta, Boston, Chicago, Dallas, New York, and San Francisco in the U.S., as well as international affiliate offices in London, Hamburg, Madrid, Paris, and Rio de Janeiro, H.I.G. specializes in providing capital to small and medium-sized companies with attractive growth potential. H.I.G. invests in management-led buyouts and recapitalizations of profitable and well managed manufacturing or service businesses. H.I.G. also has extensive experience with financial restructurings and operational turnarounds. Since its founding in 1993, H.I.G. invested in and managed more than 200 companies worldwide. The firm’s current portfolio includes more than 50 companies. For more information, please refer to the H.I.G. website at www.higcapital.com .