New Flyer Completes Retained Interest Conversion

WINNIPEG, June 24 /CNW/ - New Flyer Industries Inc. (TSX:NFI.UN) ("New Flyer" or the "Company"), the leading manufacturer of heavy-duty transit buses in Canada and the United States, announced today that it has completed the previously announced retained interest conversion transaction, resulting in the issuance of 2,152,179 Income Deposit Securities ("IDSs"), representing approximately 4% of the outstanding IDSs, in exchange for all of the issued and outstanding 463,875 Class B and 2,053,657 Class C common shares of New Flyer's subsidiary, New Flyer Holdings, Inc. ("NFL Holdings"), indirectly held by certain current and former members of New Flyer management (the "Retained Interest Conversion").

On completion of the Retained Interest Conversion, the aggregate percentage ownership interest held by the current and former management holders' in New Flyer's business remains substantially unchanged. As of the completion of the transaction there are 49,475,279 IDSs issued and outstanding. The new IDSs were issued on a private placement basis and are not freely tradeable for a period of four months pursuant to Canadian securities laws.

This was the final exercise of liquidity rights pursuant to the securityholders' agreement governing NFL Holdings. As a result, New Flyer now holds 100% of the economic and voting interest in NFL Holdings.

About New Flyer

New Flyer is the leading manufacturer of heavy-duty transit buses in the United States and Canada. The Company's three facilities -- in Winnipeg, MB, St. Cloud, MN and Crookston, MN - are all ISO 9001, ISO 14001 and OHSAS 18001 certified. With a skilled workforce of over 2,000 employees, New Flyer is a technology leader, offering the broadest product line in the industry, including drive systems powered by clean diesel, LNG, CNG and electric trolley as well as energy-efficient gasoline-electric and diesel-electric hybrid vehicles. All products are supported with an industry-leading, comprehensive parts and service network. The Company's income deposit securities are traded on the Toronto Stock Exchange under the symbol NFI.UN. Further information is available on Company's web site at www.newflyer.com.

Forward-Looking Statements

This press release may contain forward-looking statements relating to expected future events and financial and operating results of New Flyer and New Flyer Industries Canada ULC ("NFI ULC") that involve risks and uncertainties. Although the forward-looking statements contained in this press release are based upon what management believes to be reasonable assumptions, investors cannot be assured that actual results will be consistent with these forward-looking statements, and the differences may be material. Actual results may differ materially from management expectations as projected in such forward-looking statements for a variety of reasons, including market and general economic conditions and the other risks and uncertainties discussed in the materials filed with the Canadian securities regulatory authorities and available on SEDAR at www.sedar.com. Due to the potential impact of these factors, New Flyer and NFI ULC disclaim any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, unless required by applicable law.

For further information: New Flyer Industries Inc., Glenn Asham, Chief Financial Officer, Tel: [phone]