United Specialties Inc. Creates Wholly-Owned Subsidiary Which is Expected to Generate in Excess of $14 Million of Gross Revenue in First Year of Operations

Wednesday, March 03, 2004 07:30 ET

LONG ISLAND CITY, N.Y., Mar 3, 2004 (BUSINESS WIRE) -- United Specialties, Inc. (the "Company") (OTCBB:UNSP), an importer, packer, and distributor of specialty and gourmet foods and the first importer of fresh truffles into the U.S., today announced that the Company has approved the creation of a wholly-owned subsidiary, Gourmet Specialties Int'l Ltd. The subsidiary will be headed by David Darwish as Chief Executive and Operating Officer. Mr. Darwish is the owner of a California-based privately-held merchandiser distributing over 400 specialty food products.

The subsidiary will, over a 60-day period, operate in two divisions; one which will be the Northeast Domestic Division generating revenues of approximately $4 million annually with gross margins approximating 25% and the other will be the Gourmet Food Import Division which is expected to generate revenues in excess of $10 million per annum with gross margins approximating 7 1/2%. Both divisions should continue to operate profitably and have minimal debt.

The subsidiary will assume no debt or liability from United Specialties, Inc. and no assets of United Specialties, Inc. will be placed in the subsidiary.

Shareholders will be notified upon the closing of this transaction and will be provided details of the transaction via press release and the filing of a Form 8-K with the Securities and Exchange Commission.

The Company concurrently announced that it ultimately plans to spin-off, to the shareholders of record on or about May 3, 2004, Gourmet Specialities Int'l, Ltd. into another completely separate public entity, with an independent Board of Directors, management team, legal counsel, auditors and transfer agent. In addition, Mr. Darwish and certain other individuals will receive an aggregate of 50% of the common stock of Gourmet Specialties Int'l Ltd. The Company's intention is to seek quotation of the common stock of Gourmet Specialties Int'l Ltd. on the Nasdaq Over-the-Counter Bulletin Board.

When consummated, United Specialities' shareholders will receive the same proportionate ownership in the 50% of Gourmet Specialties Int'l Ltd. owned by the Company as they own in United Specialties at the time of the spin-off.

Safe Harbor

This announcement contains forward-looking statements that involve risks and uncertainties, including those relating to the company's ability to develop and expand its business. Actual results may differ materially from the results anticipated, and reported results should not be considered a reflection of future performance. The potential risks and uncertainties include, among other things, its limited financial resources, difficulties and risks associated with operating in foreign jurisdictions, domestic and global economic conditions, and conditions of the equity markets, More information about the potential factors that could affect the company's business and financial results is and will be included in the company's filings with the Securities and Exchange Commission.

SOURCE: United Specialties, Inc.

CONTACT: Investor Contact:
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Cynthia DeMonte, 212-605-0525
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