Keystone North America and Keystone Newport ULC complete C$171 million initial public offering of income participating securities

On February 8, 2005, Keystone North America Inc. (KNA) and Keystone Newport ULC (KNA ULC) successfully completed an initial public offering of 17,100,000 income participating securities (IPSs) at a price of C$10 per IPS for gross proceeds of C$171 million. In connection with this offering, KNA ULC also sold, on a private placement basis, C$10 million principal amount of separate subordinated notes that are not in the form of IPSs.

Upon closing, KNA and KNA ULC acquired all of the issued and outstanding class A common shares and preferred shares of Keystone Group Holdings, Inc. (Keystone). Concurrent with the offering, Keystone acquired the funeral and cemetery business of Hamilton Funeral Services Centers (Hamilton), a company similar in size to Keystone. The combined company owns and operates 177 funeral homes and nine cemeteries in 26 states in the United States, making it, in management's estimate, the fifth-largest funeral home operator in the United States.

The offering was underwritten by a syndicate led by BMO Nesbitt Burns and Scotia Capital, and including CIBC World Markets, RBC Dominion Securities, National Bank Financial and TD Securities. On February 17, 2004, the underwriters exercised their over-allotment option, thereby raising additional gross proceeds of C$16,680,170.