The line of credit will support Aegis'
expansion in the food and beverage industry.
TORONTO, Dec. 7, 2021 /CNW/ - Today, Aegis Brands Inc.
(TSX: AEG) ('Aegis') finalized a new development line of credit
(DLOC) from CWB Franchise Finance, a CWB Financial Group partner
company ('CWB'), for $28 million CAD.
The DLOC will be used to continue Aegis' growth in Canada's food service industry through
acquisition. The DLOC is available for 36 months and is subject to
a variable interest rate of prime plus 2.75%.
The DLOC from CWB, in addition to an existing and unused
$2 million line of credit, presents
Aegis with the resources it needs to invest in food service
companies across the country and expand its presence in the food
and beverage industry. Aegis intends to use these funds for new
acquisitions and growth of existing and acquired brands.
Aegis may finance acquisitions through a combination of an equity
raise, CWB debt and issuing Aegis stock to the vendors of any brand
joining the Aegis roster. "It is important to the future of the
acquired brand, and shareholders of Aegis, that entrepreneurs stay
involved and can participate in the growth of Aegis post-closing.
Alignment is prerequisite for any deal we will look at" said
Steven Pelton, President and CEO of
Aegis Brands Inc.
"We're happy to receive this line of credit from CWB, one of
Canada's leading lenders in the
restaurant and hospitality space," continued Pelton, "Not only does
this line of credit give us the ability to acquire great brands in
the F&B space, but it is also an acknowledgement of Aegis's
strategy of assembling great brands, and great leaders and allowing
them to grow with our support. Additionally, Aegis will be able to
capitalize on the exceptional track record and experience the board
and management already possess in this sector.
2021 has proven that consumers are eager to return to
restaurants and food service locations, creating an opportunity to
invest in the food industry. The hospitality industry is expected
to make a strong comeback, with full-service restaurant sales
expected to grow from $25.6 billion
in 2021 to $35.2 billion in 2022,
according to Restaurants Canada. Meanwhile many quick service
brands have seen steady or increasing revenue since the middle of
2020. The outlook for Fast Casual and QSR brands that have embraced
delivery, order ahead and other digital enhancements adopted during
the pandemic looks promising.
"We know that Aegis is ready for significant growth as they
expand in the food and beverage space," said Jacob Mancini, Assistant Vice President,
Restaurant & Brewery Finance at CWB. "The company's
success with Bridgehead is a testament to their commitment to the
industry. We look forward to strengthening this already beneficial
relationship as they continue to grow."
With 20-plus years of experience in the restaurant industry, CWB
is a leading lender to the Canadian hospitality industry. To date,
they've invested over $3.5 billion in
the Canadian restaurant and hotel space, with more than 900
clients.
FORWARD LOOKING STATEMENTS
This press release contains forward-looking statements within
the meaning of Canadian securities laws. These forward-looking
statements contain statements of intent, belief or current
expectations of Aegis. Forward-looking information is often, but
not always identified by the use of words such as "anticipate",
"believe", "expect", "plan", "intend", "forecast", "target",
"project", "may", "will", "should", "could", "estimate", "predict"
or similar words suggesting future outcomes or language suggesting
an outlook.
The forward-looking statements included in this press release,
including statements regarding the nature of Aegis' growth strategy
going forward, the use of CWB's financing for new acquisitions and
brand growth and the expected comeback of the hospitality industry,
are not guarantees of future results and involve risks and
uncertainties that may cause actual results to differ materially
from the potential results discussed in the forward-looking
statements.
Risks and uncertainties that may cause such differences include
but are not limited to: risks that the sale of Hemisphere may have
a negative impact on the market price and liquidity of Aegis'
common shares; risks related to the company's strategy going
forward; the ability to source, complete and integrate acquisition
targets; risks related to the COVID-19 pandemic; and other risks
inherent in the industry in which Aegis operates. Accordingly,
readers should not place undue reliance on the forward-looking
statements and information contained in this news release.
Additional information on these and other factors that could affect
Aegis' operations or financial results are included in reports on
file with applicable securities regulatory authorities and may be
accessed through the SEDAR website (www.sedar.com).
In respect of the forward-looking statements and information
included in this press release, Aegis has provided such in reliance
on certain assumptions that it believes are reasonable at this
time, including the ability of the company to manage the risks
(economic, operational, financial, and other risks) associated with
the COVID-19 pandemic, the ability of the company to identify new
acquisition opportunities and to successfully integrate past and
future acquisition targets into the company's business, and the
company's ability to generally execute on its strategy going
forward.
The forward-looking statements in this press release are made as
of the date it was issued and Aegis does not undertake any
obligation to update publicly or to revise any of the included
forward-looking statements, whether as a result of new information,
future events or otherwise, except as required by applicable
law.
About Aegis Brands Inc.
Aegis Brands Inc. currently owns and operates Bridgehead Coffee.
The company's vision is to build a portfolio of amazing brands that
can grow and flourish with access to Aegis' resources and
expertise. The company is committed to letting each brand operate
independently while providing shared expertise to help them
thrive.
For more information, please visit aegisbrands.ca.
SOURCE Aegis Brands Inc.