NIAGARA-ON-THE-LAKE, ONTARIO -- (Marketwired) -- 10/01/14 -- Diamond Estates Wines & Spirits Inc. ("DEWS") (TSX VENTURE: DWS) with Kirkwood Brands Ltd., a part of The Kirkwood Group Ltd. ("TKG") are pleased to announce that they have completed the formation of the previously announced partnership called Kirkwood Diamond Canada Partnership ("KDC").
KDC has been registered as a general partnership in Ontario to conduct the business of selling and promoting beverage alcohol products across Canada as an agent for leading suppliers. The partners have made their initial capital contributions in accordance with the terms of a partnership agreement dated September 5, 2014. The parties are working towards the consolidation of accounting systems, personnel and other facets related to the merger that will enable fully integrated operations by the end of the year. This includes the ongoing transfer of assets into the partnership on a tax efficient basis as the final values are determined.
Both DEWS and TKG have substantially completed due diligence with respect to the brands under agency that KDC is assuming. The partnership interests reflect an equal contribution from each of DEWS and TKG. The parties have valued each partner's interest at approximately $3.7M, based primarily on using fiscal 2014 gross margin normalized for variable selling costs.
J. Murray Souter, President and CEO of Diamond Estates Wines and Spirits stated that "this partnership combines two portfolios of leading global brands, creating one of the leading agencies in Canada with strong representation across the country. We look forward to working with our partner to develop our existing brands, accelerate growth for our suppliers and build long-term value for our stakeholders."
Gordon Haist, CEO of Kirkwood Diamond Canada stated that "we are excited about the tremendous business opportunities this partnership creates and we look forward to growing our suppliers' business both now and in the future."
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Forward Looking Statement
This press release contains forward-looking statements. Often, but not always, forward-looking statements can be identified by the use of words such as "plans", "expects" or "does not expect", "is expected", "estimates", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or state that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved. Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Diamond Estates Wines and Spirits Inc., the Kirkwood Group, or the proposed partnership's (the "parties") to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Actual results and developments are likely to differ, and may differ materially, from those expressed or implied by the forward-looking statements contained in this press release. Such forward-looking statements are based on a number of assumptions which may prove to be incorrect, including, but not limited to: the ability of the parties to complete the transaction; the economy generally; consumer interest in the services and products of the joint venture; financing; competition; and anticipated and unanticipated costs. While the parties acknowledge that subsequent events and developments may cause its views to change, the parties specifically disclaim any obligation to update these forward-looking statements. These forward-looking statements should not be relied upon as representing the views of either party as of any date subsequent to the date of this press release. Although the parties have attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements. Closing of the transaction remains subject to the final approval of the TSX Venture Exchange.
Contacts:
Diamond Estates Wines & Spirits Inc.
J. Murray Souter
(905) 641-1042 ext. 234
jmurraysouter@diamondwines.com
