Reitmans Canada announces agreement with tax authorities

    MONTREAL, Feb. 12 /CNW Telbec/ - Reitmans (Canada) Limited ("Company")
announces that it has entered into an agreement ("Agreement") with the Canada
Revenue Agency, Alberta Finance, the Ontario Ministry of Revenue and Revenue
Québec to settle all matters arising from reassessments issued to certain of
its affiliates as a result of the retroactive Income Tax legislation enacted
by the Government of Québec in June, 2006.
    When the reassessments were issued to its affiliates, their effect was
recognized and disclosed in the second quarter of the Company's 2007 fiscal
year as a current Income Tax Expense, and the Liability was recognized in each
succeeding Balance Sheet of the Company. Interest expense was accrued each
quarter thereafter as the liability remained unpaid. On the day prior to the
date of the Agreement, the Income Tax Expense and Accrued Income Tax Liability
relative to this issue amounted to $21,931,000. The Agreement calls for the
Company and its affiliates to pay $13,165,000 to settle all related
outstanding matters, and as such, in the fourth quarter of the Company's 2008
fiscal year, ended February 2, 2008, the difference of $8,766,000 is expected
to be recognized, reducing the Company's Income Tax Expense and increasing the
Company's Net Income after Income Tax by that same amount.
    Under the terms of the Agreement, the Company is liable to pay
$13,165,000 no later than March 31, 2008.

    February 12, 2008

    Jeremy H. Reitman, President
    Telephone: (514) 385-2630

    All of the statements contained herein, other than statements of fact
that are independently verifiable at the date hereof, are forward-looking
statements. Such statements, based as they are on the current expectations of
management, inherently involve numerous risks and uncertainties, known and
unknown, many of which are beyond the Company's control. Such risks include
but are not limited to: the impact of general economic conditions, general
conditions in the retail industry, seasonality, weather and other risks
included in public filings of the Company. Consequently, actual future results
may differ materially from the anticipated results expressed in
forward-looking statements. The reader should not place undue reliance on the
forward-looking statements included herein. These statements speak only as of
the date made and the Company is under no obligation and disavows any
intention to update or revise such statements as a result of any event,
circumstances or otherwise, except to the extent required under applicable
securities law.
    %SEDAR: 00002316EF

For further information: Jeremy H. Reitman, President, (514) 385-2630