EDMONTON, March 20, 2007 /PRNewswire-FirstCall via COMTEX/ -- Planet Organic Health Corp.("Planet Organic") - (TSX Venture Exchange - POH) announced today that they have signed a definitive Letter of Intent whereby Planet Organic will acquire 100% of the shares of Mrs. Green's Natural Market, Inc. ("Mrs Green's") for an undisclosed cash purchase price which will be disclosed in a press release upon closing the acquisition.
Mrs. Green's is one of the leading natural and organic food retailers in the Northeastern U.S. Based on management prepared financial statements for the year ended December 31, 2006 (unaudited), Mrs. Green's had revenue of $38,125,860, EBITDA (defined as earnings before interest, income taxes, depreciation and amortization) of $4,789,516, total assets of approximately $5,503,370, and negative working capital of $964,930. All figures are in U.S. dollars and are subject to adjustment based on the completion of audited financial statements. The privately held Company operates 11 stores located in the New York/Connecticut area. Mrs. Green's owners and founders Harold and June Hochberger will be staying on to assist Planet Organic in their U.S. growth plans.
"This merger marks a new era for Planet Organic," reports Darren Krissie, Planet Organic's CFO. "We have made several retail acquisitions in our history and Mrs. Green's will be our largest acquisition to date, which gives Planet Organic an excellent platform to continue with further U.S. expansion. We are particularly excited to gain many talented team members who will provide valuable expertise and experience in achieving future growth. Our company continues to evolve at a rapid pace," Mr. Krissie continued. We believe this merger will result in a company that is much stronger and better-positioned for the future."
Mrs. Green's founder and Co-President, Harold Hochberger stated, "We share Planet Organic's vision and retailing philosophy and believe Planet Organic is a good fit and opportunity for our staff that have been with us over the years. We're excited to join with Planet Organic and look forward to building a market leader in natural and organic foods in smaller communities."
"Planet Organic has had a large impact on the natural and organic foods movement throughout Canada, helping lead the industry to nationwide acceptance and to becoming one of the fastest growing segments in food retailing today," said Ron Francisco, chairman and chief executive officer of Planet Organic. "Planet Organic and Mrs. Green's have similar core values, and we believe this combination will create long-term value for our staff, customers and shareholders."
Upon closing the acquisition of Mrs. Green's it is anticipated that Planet Organic will grant options to the principals of Mrs. Green's to acquire an aggregate of 250,000 common shares at a price of $2.50 per common share and 612,000 options to the directors, officers, employees and consultants of Planet Organic at a price of $2.70 per share. All options will expire five years from the date of grant. In addition, certain insiders of Planet Organic will receive 200,000 Planet Organic common shares at an issue price of $2.50 per share that will occur concurrently with closing the Green's acquisition.
Planet Organic also announces a private placement of up to a maximum of $6,000,000 at an issue price of $2.50 per common share to qualifying residents under applicable securities legislation. The common shares may also be sold to institutional and accredited investors in certain foreign jurisdictions, pursuant to applicable securities regulations. The proceeds will be used to pay a portion of the Mrs. Green's purchase price. The balance of the purchase price will be satisfied via a debt facility to be secured prior to closing the acquisition. It is anticipated that the private placement and the Mrs. Green's acquisition will close by April 30, 2007. The private placement is subject to TSXV approval and the common shares will be subject to a four month hold period.
The purchase price is subject to closing adjustments relating to prepaid expenses and working capital adjustments. Any upward adjustments to the purchase price resulting from working capital adjustments will be satisfied via the issuance of Planet Organic common shares at an issue price of $2.50 per share. The transaction is arms length and will not result in change of control or management of Planet Organic. Additional details regarding Mrs. Green's historical income statement and balance sheet information will be disclosed in a future press release. Closing is subject to a number of conditions, including TSX Venture Exchange approval and further due diligence by Planet Organic, including the completion of audited financial statements for Mrs. Green's. Mrs. Green's is represented by Partnership Capital Growth Advisors of San Francisco, California.
ABOUT PLANET ORGANIC HEALTH CORP.
Planet Organic Health Corp. (CA:POH: news, chart, profile) , is a natural products industry company, comprising manufacturing, distribution and retail. Planet is listed on the TSX Venture Exchange as a Tier One company. Planet operates eight natural food supermarkets throughout Canada under the Planet Organic Market banner. The Company also operates 50 natural health outlets under the Sangster's Health Centre banner and seven natural health outlets under the Healthy's banner. Another POHC company, Trophic Canada is the country's leading manufacturer of natural supplements. The Company has a total of 64 stores throughout the country.
The TSX Venture Exchange has not reviewed and does not accept
responsibility for the adequacy or accuracy of this release.
Certain information included herein is forward-looking. Forward-looking statements include, without limitation, statements regarding the future financial position, business strategy, budgets, projected costs, capital expenditures, financial results, taxes and plans and objectives of or involving Planet. Many of these statements can be identified by looking for words such as "believe", "expects", "expected", "will", "intends", "projects", "anticipates", "estimates", "continues". Planet Organic believes the expectations reflected in such forward-looking statements are reasonable but no assurance can be given that these expectations will prove to be correct and such forward-looking statements should not be unduly relied upon. Forward-looking statements are not guarantees of future performance and involve a number of risks and uncertainties some of which are described in Planet Organic's continuous disclosure documents. Such forward-looking statements necessarily involve known and unknown risks and uncertainties and other factors, which may cause Planet Organic's actual performance and financial results in future periods to differ materially from any projections of future performance or results expressed or implied by such forward-looking statements. Such factors include, but are not limited to: general economic, market and business conditions; industry capacity; competitive action by other companies; refining and marketing margins; the ability of suppliers to meet commitments; actions by governmental authorities including increases in taxes; changes in environmental and other regulations; and other factors, many of which are beyond the control of Planet Organic. Any forward-looking statements are made as of the date hereof and Planet Organic does not undertake any obligation, except as required under applicable law, to publicly update or revise such statements to reflect new information, subsequent or otherwise.