Toronto, Sept. 1 - CoolBrands International Inc. today announced that its subsidiary, Eskimo Pie Corporation, has entered into a definitive agreement to sell its Value America flavors and ingredients division, a division of CoolBrands that manufactures and sells a full line of quality flavors, chocolate coatings, fudge sauces, powders for chocolate milk, eggnog bases and other ingredients, to a leading inventor and marketer of specialty flavors for the ice cream industry for a purchase price of US$10,000,000.
The sale is expected to close during September 2006. Net proceeds from the sale will be used to repay a portion of CoolBrands' borrowings.
Value America's results from operations formed a significant part of the Dairy Components segment of CoolBrands' operations. For the fiscal year ended August 31, 2005, the Dairy Components segment of CoolBrands contributed US$19,538,000 of net revenues, and US$2,593,000 of earnings from continuing operations before taxes.
For the nine months ended May 31, 2006, the Dairy Components segment of CoolBrands contributed US$14,630,000 of revenues, and US$1,763,000 of earnings from continuing operations before taxes.