Sterling, CPP Increase Offer for Livingston

Sterling Partners and CPP Pension Plan have increased their offer to acquire Canadian logistics services provider Livingston International Income Fund (TSX: LIV), from C$8 per share to C$9.50 per share. The total deal value is now around C$273 million. Sterling would hold a 60% stake following the transaction, with CPP holding the remainder.

PRESS RELEASE

Livingston International Income Fund (TSX: LIV.UN) (“Livingston”), Canada Pension Plan Investment Board (“CPPIB”) and Sterling Partners announced today that they have agreed to amend the acquisition agreement dated October 7, 2009 to increase the amount of consideration to be received by unitholders from $8.00 to $9.50 in cash per unit (less any amounts withheld from non-resident unitholders on account of taxes, as applicable).

CPPIB and Sterling Partners have advised Livingston that unitholders representing 20,379,669 units, or approximately 59.7% of the total outstanding units, including 10 large institutional unitholders representing 19,531,621 units, or approximately 57.2% of the total outstanding units, have voted for the existing offer or committed to support the amended offer, provided that no superior offer is made. In the case of committed unitholders representing 33.6% of the total units, a superior offer is defined as one under which Livingston unitholders would receive more than $10.10 per unit.

The amended price represents a premium of 19% to the original offer and of 54% based on the volume-weighted average price of the units for the 30 trading days ended October 7, 2009, the day before the original offer by CPPIB and Sterling Partners was announced. The amended offer has the unanimous support of Livingston’s board of trustees.

“Now that a majority of our investors have indicated their support for this offer, we are confident that remaining unitholders will also elect to receive the significant cash premium and immediate liquidity,” said Peter Valentine, Chairman of Livingston’s Board of Trustees. “With CPP Investment Board and Sterling Partners as owners, Livingston will be well positioned for future growth.”

Rick Elfman, Senior Managing Partner for Sterling Partners, said, “Since we first made our offer over two months ago, the debt markets have improved. This has enabled us to put a more appropriate capital structure in place and amend our valuation of the company.”

Added Mark Wiseman, Senior Vice President, Private Investments CPPIB, “Recent improvements in economic conditions, unexpected gains in the Canada-U.S. trade surplus and more favourable terms from our lending syndicate have had a positive impact on Livingston’s outlook and have altered the fundamentals of this transaction. We are pleased to have the support of Livingston’s board, management and a majority of investors and look forward to completing this transaction to acquire a leading Canadian company.”

Under the amended acquisition agreement, CPPIB and Sterling Partners would be entitled to an increased termination fee of $11.9 million in certain circumstances. The closing of the transaction would occur on the later of January 19, 2010 and that date which is five business days after the receipt of the final required approval. Investment Canada Act approval of the transaction is expected to be received on or before December 23, 2009. The transaction continues to be subject to other customary closing conditions.

The transaction is subject to approval by unitholders holding more than 66 2/3% of the units actually voting at the special unitholder meeting. As previously announced, the special unitholder meeting to approve the acquisition by CPPIB and Sterling Partners is now scheduled for Wednesday, December 23, 2009 at 9:30 a.m. EST, and the voting deadline has been extended to Monday, December 21, 2009 at 9:30 a.m. EST. The record date for the special meeting remains October 14, 2009, and the location remains the offices of Stikeman Elliott LLP, 199 Bay Street, Commerce Court West, in Toronto.

Livingston has also retained Scotia Capital Inc. as soliciting dealer manager. Scotia Capital Inc. will form a soliciting dealer group consisting of members of the Investment Dealers Association of Canada. Members of the soliciting dealer group will be invited to solicit Livingston unitholders in Canada to vote for the arrangement resolution. Subject to certain exceptions, a solicitation fee of Cdn$0.05 for each Livingston unit voted for the arrangement resolution will be payable to the soliciting dealer whose name appears in the appropriate space on the Livingston proxy form or voting instruction, subject to a minimum fee of Cdn$100.00 and a maximum fee of Cdn$1,500.00 in respect of each beneficial owner of Livingston units holding at least 500 units. Livingston will also be reimbursed by CPPIB and Sterling Partners for all reasonable costs and expenses, including communication expenses, incurred by the dealer manager. No solicitation fees will be payable if the arrangement is not completed. CPPIB and Sterling Partners will bear the costs of the solicitation of proxies.