NOT FOR DISTRIBUTION IN THE UNITED STATES OR OVER U.S. WIRE SERVICES

ARCTIC GROUP ANNOUNCES NEW STRUCTURE TO MAXIMIZE SHAREHOLDER VALUE

Winnipeg, Manitoba - The Arctic Group Inc. (AGP:TSE) announced today that its Board of Directors has agreed to propose a reorganization of the company ("the Transaction") as an income trust to be called the Arctic Glacier Income Fund (the "Fund"). The proposed reorganization is the cornerstone of a plan to unlock the value of the significant cash flows generated by the company, strengthen its financial position, and provide an enhanced platform for growth. The Transaction will be accomplished by way of a Plan of Arrangement ("Arrangement") that is subject to approval by shareholders and holders of convertible debentures at a meeting to be held on March 11, 2002. The Plan of Arrangement will also be subject to court and other regulatory approvals.

Under the terms of the Transaction, existing shareholders of The Arctic Group Inc. ("Arctic") will indirectly receive one unit of the newly established Fund in exchange for six common shares of Arctic, which currently has 36.26 million shares outstanding. Concurrent with this reorganization, the Fund will file a prospectus in connection with an initial public offering (IPO) with the intent to raise approximately $85 million of trust units and will enter into a new bank credit facility. The Fund has received conditional approval from the TSE to trade under the symbol AG.UN.

After completion of the Plan of Arrangement, the Fund will own all of the common shares of the operating company that will carry on the business currently conducted by Arctic and operate under the name Arctic Glacier Inc. Cash flow available from the business after interest, capital expenditures and the fulfillment of other cash requirements will flow to the Fund. The Fund's policy will be to make monthly distributions of its available cash to the maximum extent possible.

Based on actual results for the first eleven months of 2001, management of Arctic estimates that, organized as an income trust and recapitalized, Arctic would have generated distributable cash of at least $15.8 million on a pro-forma basis during this period. This assumes gross proceeds of $85 million from the IPO and $53 million of debt drawn under the new credit facility, which will be used to payout essentially all of the current credit facilities and long term debt, pay transaction costs, and fund working capital for continued growth and expansion. Arrangements have been made with Arctic's existing lenders to provide for early retirement of these obligations, and the expiration of warrants currently held by holders of subordinated debentures.

Reasons for Reorganizing

Arctic's business is characterized by high EBITDA (earnings before interest, taxes, depreciation and amortization) margins combined with minimal requirements for maintenance capital expenditures. In addition, the company has reached the critical mass and geographic diversification necessary to maintaining a strong and stable cash flow base. Since becoming a public company in 1997, Arctic has been able to consistently increase both revenue and EBITDA on a year over year basis. These attributes provide a strong rationale for reorganizing Arctic into an income trust.

Investors in income trusts generally value companies on a distribution yield basis, much like a dividend yield, which is expected to result in more favourable valuations of Fund units compared to existing common shares. Following successful completion of the Fund's IPO, it is expected that new investors will be attracted which should provide a more active and liquid market for the Fund's units. With better access to capital markets, and a much stronger balance sheet, the Fund is expected to have improved opportunities to continue to grow through acquisition.

There are other advantages that Arctic's management expects and identifies resulting from reorganization as an income trust. The recapitalized and strengthened balance sheet and new financing will result in much lower leverage and a debt to equity ratio expected to be less than 0.5 to 1, compared to 2.35 to 1 at September 30, 2001 in the existing corporate structure. Significantly lower interest costs and borrowing rates are expected as a consequence of the refinancing and reorganization.

Plan of Arrangement

The reorganization will be effected pursuant to an Arrangement under the Business Corporations Act (Alberta). The Arrangement is subject to the approval of at least 66 2/3% of the votes cast by shareholders and option holders and by at least 66 2/3% of the votes cast by the convertible debenture holders. Directors, management and other insiders who control more than 50% of the company's issued and outstanding shares have signed support agreements indicating their intention to vote in favour of the Arrangement.

KPMG Corporate Finance Inc. has been retained by a special committee of the Board of Directors of Arctic to provide an opinion to the special committee and the Board of Directors as to the fairness of the Arrangement, from a financial point of view, to the existing Arctic shareholders.

In addition to the requirement for shareholder approval, the conversion of common shares of Arctic into Fund units will be contingent on the concurrent satisfaction of other conditions, including obtaining regulatory and court approvals, completion of the IPO of units of the Fund, finalization of the new bank credit facility, and repayment of essentially all of the currently outstanding indebtedness of Arctic.

The conversion of Arctic common shares into units of the Fund will result in a disposition for current shareholders giving rise to a gain or a loss for tax purposes. Current and potential investors are encouraged to seek independent tax advice in respect of the consequences to them of the Arrangement.

An information circular detailing the Plan of Arrangement will be mailed to security holders in early February 2002 and will be available on the internet at www.sedar.com and at www.arcticgroup.com . The Special Meeting of holders of common shares, options to purchase common shares, and convertible debentures to consider the transactions will be held on March 11, 2002 in Winnipeg.

Public Offering

Concurrent with Arctic's reorganization as an income trust, the Fund will undertake an IPO of approximately $85 million of trust units with a syndicate of underwriters led by TD Securities Inc. The preliminary prospectus in connection with the IPO is expected to be filed with securities regulators during the week of February 11, 2002 and the marketing of the offering will take place prior to the shareholders meeting on March 11, 2002. The Fund anticipates pricing the offering shortly after shareholder and court approval of the Plan of Arrangement. Closing is expected on or about March 20, 2002.

New Bank Credit Facility

The Arctic Group Inc. is a leading North American producer, marketer and distributor of high-quality packaged ice products to consumers in Canada and the United States under the brand name of Arctic Glacier Premium Ice TM. The Arctic Group is committed to creating shareholder value through prudent management and growing penetration of branded ice products in key target markets.

For further information, call The Arctic Group Inc. TOLL FREE at 1-888-573-9237 or visit The Arctic Group's Web Site at www.arcticgroup.com .

(Signed)
On behalf of the Management and the Board of Directors of The Arctic Group Inc.,
Robert Nagy, Chairman & CEO.

The Toronto Stock Exchange does not approve or disapprove of the adequacy or accuracy of this release.