Sepp’s Gourmet Foods Ltd. (SGO-TSE) announces that a company controlled by a group headed by Dr. K. Peter Geib and comprised of certain members of management, directors and existing shareholders of the Company, has advised the Company’s board of directors that it intends to make an offer (the “Offer”) to acquire all of the outstanding common shares of the Company not owned by group members for $0.68 cash per share.

The Offer, which will constitute a “going private transaction”, is intended to be carried out by way of plan of arrangement or other similar form of business combination transaction. Definitive agreements outlining the exact terms of the Offer are currently being negotiated and are expected to be executed on or about July 20, 2001. The terms of the Offer will be described in an information circular to be mailed to registered holders of the Company’s common shares.

The Company’s board of directors has established a special committee to review, consider, negotiate and make recommendations on the proposed transaction terms with the authority to engage such professional advisors as may be required to carry out its mandate. The completion of the transaction will be conditional upon, among other things, receipt of all required regulatory and shareholder approvals.