Angelica Selects Purchasers for Manufacturing and Marketing Segment.

Business Editors

ST. LOUIS--(BUSINESS WIRE)--March 4, 2002

Angelica Corporation (NYSE:AGL) announced today that it is in negotiations with two purchasers for the sale of its Manufacturing and Marketing segment, which includes the Angelica Image Apparel operations in the U.S. and Sally Fourmy & Associates in Canada. Cintas Corporation, Cincinnati, OH, a publicly-traded industrial textile rental company with image apparel operations in the U.S. and Canada, is expected to purchase certain assets of the non-healthcare business of the Manufacturing and Marketing segment; and Medline Industries, Inc., Mundelein IL, a privately-held supplier of various products to the healthcare industry, is expected to purchase certain assets of the healthcare business of the Manufacturing and Marketing segment. Consummation of the sale is subject to further due diligence by Cintas and Medline and the execution of definitive asset purchase agreements, expected to be completed in March. Closing dates for the separate purchases have not been fixed.

Angelica also said that it will treat the Manufacturing and Marketing segment as a discontinued operation for accounting purposes, which will require reclassification of the segment's prior years' financial results. It was noted that the net book value of the assets of the segment, about $97 million at the end of last December, is expected to be written down by approximately one-third to reflect the sale proceeds less the costs of winding down and ultimate dissolution of the business. The precise amount of the write down of assets to reflect the sale and dissolution will be reported when fiscal year 2002 results are released, expected to be in the last half of March.

Angelica further noted that approximately $50 million of the proceeds from the sale and dissolution of the Manufacturing and Marketing segment will be used to pay down a portion of its $71.4 million of outstanding debt, with the balance of the debt planned to be refinanced with either the current lenders or new lenders.

Don W. Hubble, Chairman, President and Chief Executive Officer of Angelica said, "Sale of the Manufacturing and Marketing business is clearly the right action for Angelica to take in order to maximize future shareholder value. Angelica will be a smaller but stronger company, focused on the attractive healthcare services markets through its Textile Services segment and its Life Retail Stores segment, both of which have excellent growth opportunities."

Angelica Corporation, traded on the New York Stock Exchange under the symbol AGL, provides textile rental and laundry services to healthcare institutions, manufactures and markets uniforms for institutions and businesses, and operates a national chain of retail uniform and shoe stores.