Ault Foods and Parmalat Enter Acquisition Agreement Under which Parmalat will Offer $34 Per Share or $415 Million in Total Value for Ault.

ETOBICOKE, ONTARIO--(BUSINESS WIRE)--June 9, 1997--(TSE, ME AUL. ) Ault Foods Limited and Parmalat Finanziaria S.p.A. today announced that they have entered into an acquisition agreement under which Parmalat Food Inc., a subsidiary of Parmalat, will offer $34 per share for all of Ault's outstanding common shares.

The 100 percent cash offer has been unanimously approved by Ault's Board of Directors, which has agreed to recommend that shareholders accept the offer. The offer, which has a total value of approximately $415 million, will be mailed to Ault shareholders by Parmalat Food by June 11 and will be open for a minimum of 21 days.

The earlier offer from the Saputo Group Inc., at $28 per share, which valued Ault at $342 million, is open for acceptance until Thursday, June 12 at 5 p.m. Any Ault shareholders, who have tendered their shares to the Saputo offer, must withdraw them by midnight Wednesday, June 11 if they wish to take advantage of the higher Parmalat offer, which provides approximately $73 million in additional value.

"We believe that this bid provides Ault shareholders with an attractive opportunity to achieve value for their shares," said Graham Freeman, President and Chief Executive Officer. "Parmalat will be able to develop a strong presence in North America by adding cheese and tablespreads to its other existing dairy and bakery businesses."

Through subsidiaries, Parmalat operates more than 100 plants in 23 countries supplying milk and dairy products, including Ultra High Temperature (UHT) milk, fruit juices, vegetable-based products, and bakery goods. Parmalat has a controlling equity interest in Beatrice Foods Inc., a Canadian food processing company with fluid milk and related businesses in Canada and bakery operations in Canada and the United States.

The combination of Beatrice and Ault will produce a Company with sales approaching $2 billion; the largest share of the Canadian fluid milk market, a strong position in the North American private-label bakery business and the potential to extend Ault's existing cheese and tablespreads business into a world-competitive operation.

The Parmalat offer is subject to the customary conditions including the acceptance by holders of two thirds of Ault's common shares and the receipt of necessary regulatory approvals. Ault's Board has agreed to waive the application of the Company's shareholder rights plan for the purposes of the Parmalat offer when requested by Parmalat.

Under the terms of the acquisition agreement, Ault has agreed not to solicit or negotiate with any other potential bidders. Under certain circumstances, Ault has agreed to reimburse Parmalat for its expenses of up to $2 million. If a higher competing offer is successful, Parmalat will receive a breakup fee of approximately $1 per share. In addition, Parmalat has received an irrevocable option to purchase Ault's Montreal-based fluid milk business for $65 million, excercisable for 90 days if a higher competing offer for the Company is announced.

Parmalat is active in Western and Eastern Europe, Latin America and the United States. It has annual sales of US $4.0 billion and 22,000 employees. Its principal brands are Parmalat (milk), Kyr (yogourt), Chef (cream sauces), Pomi (tomato-based products) and Santal (fruit juices). Parmalat shares are publicly traded on the Milan Stock Exchange.

With annual sales of $880 million from continuing operations, Ault is a leading Canadian food processing company. Its continuing business consists of cheese, tablespreads, industrial and international trade, licensing dairy technologies and Quebec fluid milk. Major brands include Black Diamond, Schneider's, Lactantia, Cheestrings, Ficello, Balderson and Parkay.

CONTACT: Ault Foods

Graham Freeman, 416/620-3000