OKOTOKS, Alta. — Mullen Group Income Fund has announced it will convert from an income trust into a growth-oriented corporation.
The move is in response to the 2006 federal government decision to place restrictions on income trusts.
“On October 31, 2006 when the Federal Government announced its intention to effectively eliminate the income trust structure, we knew that the day would come when we would be forced to convert. Today we announced that a conversion in 2009 is in the best interests of Mullen and our securityholders,” said Murray K. Mullen, chairman and CEO.
“Not only are we facing a deadline to convert, we are in the midst of a seizure in the credit markets, a severe global slowdown and a dramatic decline in crude oil and natural gas pricing. Within this context we believe that a conversion at this time is prudent,” he added. “More importantly, we remain committed to our strategic plan of growth through acquisition in the two areas of the economy that we have developed a deep understanding and industry leadership – the oil and natural gas service industry and the trucking and logistics sector in North America. The Conversion will provide our management team with the best opportunity to deliver long-term capital growth and a reliable cash yield.”
Mullen Group also provided a look ahead to the remainder of 2009, which it deemed “very challenging.”
“We feel it is incumbent on all our stakeholders to share in these challenging economic times. Our securityholders have seen a material decrease in the value of their investment and will see a material decrease in their distributions in 2009. Our employees will also be sharing in the pain in 2009 through the wage freeze, hiring freeze and suspension of our profit-share program. Although it appears that the operating environment in 2009 will be much more difficult than 2008, it is our intention to continue to operate profitably and at the same time protect the jobs of as many of our people as reasonably possible,” said Mullen.
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