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PRESS RELEASE
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A&B Sound Creditors Approve Purchase by Seanix Technology
FOR IMMEDIATE RELEASE: February 22, 2005
Vancouver, BC — Creditors of A&B Sound voted today to approve a purchase of A&B Sound by Seanix Technology, a Richmond, BC-based manufacturer of computer products.
In a meeting of general creditors held in Vancouver earlier today, creditors rejected an offer by Sun Capital Group, Inc. (Sun Capital), a leading private investment firm focused on investments in market leading companies. Creditors instead voted in favour of a purchase of A&B Sound by Seanix.
Seanix has committed to offer continued employment to A&B Sound’s 800 staff, and to enter into lease agreements on all 21 Western Canadian locations.
“Seanix is obviously very interested in A&B Sound, as evidenced by their intense work over the last few weeks. I believe this is a testament to our great brand, and our employees’ great enthusiasm and great product knowledge. I look forward to working with Seanix to help transition A&B Sound to new ownership.” said Tim Howley, President and CEO.
“We will move forward to complete the CCAA process expeditiously, so the challenging work that lies ahead to revitalize and re-energize the A&B Sound brand can begin as soon as possible.”
A&B Sound received creditor protection under the Companies’ Creditors Arrangement Act (CCAA) on January 19. Based on today’s Creditors’ Meeting, the Company expects to close the purchase transaction with Seanix on March 2, 2005 and emerge from CCAA protection shortly thereafter.
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SEANIX CLARIFICATION REGARDING A&B SOUND MUSIC BUSINESS
• In the business rationale information that was included with our offer, we
inadvertently did not address the music side of the business. We apologize to the music vendors for this omission and hereby issue a clarification.
• As we have publicly stated, a primary reason for acquiring A&B is because of its great brand. The A&B brand was built on providing customers with low price and sound advice, particularly on the music side. In our view, music is the heart and soul of A&B. We believe there is absolutely no point in buying A&B Sound and then liminate the music business.
• In our written communication, we focused on the consumer electronics side of the business because increased hardware sales is a big part of our plan to restore A&B to profitability. In our view, A&B’s product shortcomings in the past have been primarily on the hardware side and we intend to right that ship.
• With respect to the music business, we share the industry view that the future growth of music is digital music download. Inexplicably, A&B does not offer a digital music download service. We believe online sales must be our first priority insofar as the music business is concerned.
• At Seanix, we have the know-how and expertise to implement such a service. Unlike A&B, we run our own IT back-end and have developed our own web-based applications and provide on-line product configuration services to computer retailers.
We have done this for many years and it is a staple of our business.
• Whether by licensing the necessary technology and making improvements to it, or developing our own, we are confident that we can implement a tremendous solution to the music side of the business by addressing the current industry trends and offering services which will create value for our future customers and our valued suppliers.
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A&B Sound Creditors Approve Purchase by Seanix Technology
FOR IMMEDIATE RELEASE: February 22, 2005
Vancouver, BC — Creditors of A&B Sound voted today to approve a purchase of A&B Sound by Seanix Technology, a Richmond, BC-based manufacturer of computer products.
In a meeting of general creditors held in Vancouver earlier today, creditors rejected an offer by Sun Capital Group, Inc. (Sun Capital), a leading private investment firm focused on investments in market leading companies. Creditors instead voted in favour of a purchase of A&B Sound by Seanix.
Seanix has committed to offer continued employment to A&B Sound’s 800 staff, and to enter into lease agreements on all 21 Western Canadian locations.
“Seanix is obviously very interested in A&B Sound, as evidenced by their intense work over the last few weeks. I believe this is a testament to our great brand, and our employees’ great enthusiasm and great product knowledge. I look forward to working with Seanix to help transition A&B Sound to new ownership.” said Tim Howley, President and CEO.
“We will move forward to complete the CCAA process expeditiously, so the challenging work that lies ahead to revitalize and re-energize the A&B Sound brand can begin as soon as possible.”
A&B Sound received creditor protection under the Companies’ Creditors Arrangement Act (CCAA) on January 19. Based on today’s Creditors’ Meeting, the Company expects to close the purchase transaction with Seanix on March 2, 2005 and emerge from CCAA protection shortly thereafter.
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SEANIX CLARIFICATION REGARDING A&B SOUND MUSIC BUSINESS
• In the business rationale information that was included with our offer, we
inadvertently did not address the music side of the business. We apologize to the music vendors for this omission and hereby issue a clarification.
• As we have publicly stated, a primary reason for acquiring A&B is because of its great brand. The A&B brand was built on providing customers with low price and sound advice, particularly on the music side. In our view, music is the heart and soul of A&B. We believe there is absolutely no point in buying A&B Sound and then liminate the music business.
• In our written communication, we focused on the consumer electronics side of the business because increased hardware sales is a big part of our plan to restore A&B to profitability. In our view, A&B’s product shortcomings in the past have been primarily on the hardware side and we intend to right that ship.
• With respect to the music business, we share the industry view that the future growth of music is digital music download. Inexplicably, A&B does not offer a digital music download service. We believe online sales must be our first priority insofar as the music business is concerned.
• At Seanix, we have the know-how and expertise to implement such a service. Unlike A&B, we run our own IT back-end and have developed our own web-based applications and provide on-line product configuration services to computer retailers.
We have done this for many years and it is a staple of our business.
• Whether by licensing the necessary technology and making improvements to it, or developing our own, we are confident that we can implement a tremendous solution to the music side of the business by addressing the current industry trends and offering services which will create value for our future customers and our valued suppliers.
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