MONTREAL based Waterproof textile products provider Priva Inc announced it has entered into a Letter Of Intent to acquire a list of retail accounts from New Jersey based Philmont Manufacturing, a division of The Strongwater Group for an undisclosed amount. The accounts being acquired have annual sales of approximately $6,000,000 USD ($7.27mm CDN).

This would result in Priva almost doubling its sales to $16 million Cdn. in the next fiscal year. Philmont manufactures and distributes a variety of waterproof and absorbent textile products for both the young and the elderly.

This acquisition is, by far, Priva''s largest ever, which is anticipated to almost double its sales in the next fiscal year and contribute significantly to its earnings per share.

For the three months ending March 31, 2005 Priva generated $2,267,818 in sales with $94,111 in after tax earnings. Priva currently has 17,242,858 shares issued and outstanding and 19,479,048 issued and outstanding on a fully diluted basis.

Priva will pay for the acquisition by issuing a total of one million shares from treasury and one million 5 year Acquisition Warrants plus an undisclosed amount of cash. The Acquisition Warrants will be exercisable at $0.50 CDN in years one and two, with an increase in the exercise price in each of the 3rd, 4th and 5th years of $0.05 / year.

The cash component of the acquisition will be paid for by Priva from working capital. This arms'' length transaction will be closing in the month of August with an effective date of August 1, 2005.
The acquisition of this customer list provides Priva with products that have an approximate 60% overlap with those products that Priva sells, and only a 5% overlap in retail customers. "With the addition of over 200 retail accounts in the USA, the benefit of such a transaction provides Priva with a significant opportunity to sell Priva''s products to Philmont''s accounts and Philmont''s products to Priva accounts", says David Horowitz, President and C.E.O., Priva Inc.

This acquisition will also provide a combined purchasing power that will improve relations with suppliers through service and pricing. Priva is confident that the product development of the combined operation will optimize manufacturing efficiencies, resulting in greater returns and expanded new product lines.

This acquisition will strengthen Priva''s Balance Sheet and will further position Priva to fund additional acquisitions. This transaction truly marks the beginning of a new era of growth and profitability for Priva.

Protective bedding products supplier and producer Philmont Manufacturing also distributes this products for over 25 years. The company philosophy is simple: quality products at competitive prices with outstanding customer service.

Philmont’s product lines include waterproof, allergy control, anti-microbial and basic protective bedding for adults and children. The company holds patents for its waterproof mattress pad and crib safety sheet. Philmont’s customer base is diverse and global, including Internet retailers, catalogs, regional chains, national chains and international mass merchants in the U.S., Canada, Europe, Asia and Australia.
Canada’s Priva Inc is a leading manufacturer, distributor and marketer of an assortment of absorbent, waterproof textile products sold to retailers in Canada, the US, the UK, Australia and New Zealand, with export sales representing just over 60% of sales. Priva''s products for adults are sold under the Priva and Americare labels, children''s products are marketed under the ''Snoozy'' and ''Tidy Turtle'' brand names and Priva''s anti-allergen products are sold under the Quroum and Zip & Block labels.