Consolidated Mercantile Incorporated - Polyair Inter Pack Inc. announces financing for its packaging business.

Canadian pool subsidiary obtains CCAA protection. 


TORONTO, Oct. 19  /PRNewswire-FirstCall/ -- Consolidated Mercantile Incorporated ("CMI" or the "Company") (TSX: "CMC"; NASDAQ: "CSLMF") announced today that its 23% investee company Polyair Inter Pack Inc. ("PPK") (TSX/AMEX: "PPK") has completed two significant developments towards meeting its previously announced objective to focus on its core packaging business.

Certain packaging subsidiaries of PPK have entered into an agreement to secure sub-debt financing of US$5,000,000. The debentures will be secured by the assets of the borrowers ranking junior only to PPK's existing working capital facility and term debt. The agreement requires completion of the transaction by November 15, 2006 and is subject to the execution of definitive documentation and other customary conditions.

In addition, in connection with an Order under the Companies' Creditors Arrangement Act ("CCAA") from the Ontario Superior Court of Justice, PPK's wholly owned Canadian subsidiary, Cantar Pool Products Limited ("Cantar"), has obtained a stay of proceedings to allow it to complete the previously announced sale of its pool equipment business, the sale of its remaining equipment associated with the above-ground pools business and to provide it with an opportunity to propose a Plan of Arrangement to its creditors. The Order does not affect PPK's packaging business which operates as a stand-alone business through separate subsidiaries and it will continue to operate in the normal course.

Certain information included in this release contains statements that are forward looking. Such forward-looking information involves risks and uncertainties that could significantly affect anticipated results in the future. We caution that forward-looking statements should not be regarded as a representation by the company that the future plans, estimates, or expectations contemplated by us will in fact be achieved. Please refer to the company's reports filed on SEDAR (http://www.sedar.com/) and EDGAR (http://www.sec.gov/edgar.shtml) for a description of the business environment in which it operates and important factors that may materially affect its results. CMI is not under any obligation, and expressly disclaims any such obligation, to update or alter its forward-looking statements. 

DATASOURCE: Consolidated Mercantile Incorporated



CONTACT: Stan Abramowitz, Consolidated Mercantile Incorporated, Phone:

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