N@N

MagIndustries Corp.: MagIndustries Corp. Announces the Completion of Due Diligence and Extension of Exclusivity Period

^{Published on 2009-08-31 15:00:55 - Market Wire}
 

TORONTO, CANADA--(Marketwire - Aug. 31, 2009) - MagIndustries Corp. ("MagIndustries" or the "Company") (TSX VENTURE:MAA) is pleased to announce that the Company received confirmation today that the legal, technical and financial due diligence with respect to the investment in the Company contemplated by the Memorandum of Understanding ("MOU") signed June 12, 2009, as described in its press releases of June 12, June 15 and July 31, 2009 has been completed. No material issues have been raised.

The MOU provides for a proposed purchase of 400 million common shares of MagIndustries by a large Chinese based multi-national company (the "Subscriber") at a price of Cdn$ 0.70 per common share (the "Investment"). The Company has granted an extension of the exclusivity period under the MOU to September 25, 2009 to accommodate the Subscriber's review and decision process.

The Company has been advised that the Subscriber has submitted the mandatory external approval request to the government of the Peoples Republic of China for an indication of "non-objection" to the Investment.

In meetings in Beijing in the first week of August between the Company and the Subscriber corporate governance principles for the effective management of the Company for the benefit of all shareholders were presented. These principles were included in draft definitive documentation consisting of a Subscription Agreement and Shareholders' Agreement submitted to the Subscriber.

Closing of the transaction contemplated by the MOU continues to be subject to a number of conditions and approvals which include, among other conditions, approval of the transaction by MagIndustries' Board of Directors, approval by a majority of MagIndustries shareholders at a special meeting of shareholders, approval by the Subscriber's Board of Directors and the approval of all relevant regulatory and government authorities. The Investment is also conditional on the arrangement of debt financing for the completion of Phase I of the Company's Kouilou Potash Project in the Republic of Congo, as a complement or alternative to debt financing that could be available to the Company from other sources, on terms agreeable to MagIndustries. Given these conditions there is no assurance that the transaction will be completed.

About MagIndustries Corp.

MagIndustries is a Canadian company whose common shares are listed on the TSX-Venture Exchange and trades in Canadian currency under the symbol "MAA". The Company has 359,552,462 shares outstanding on an undiluted basis. MagIndustries' resource subsidiaries are operating and developing major industrial projects in the Republic of Congo and the Democratic Republic of Congo. More information on the Company is available at its website, [ www.magindustries.com ].

Except for historical information, this press release contains forward-looking statements, which reflect the Company's current expectation regarding future events. These forward-looking statements involve risks and uncertainties, which may cause actual results to differ materially from those statements. Those risks and uncertainties include, but are not limited to, changing market conditions, and other risks detailed from time-to-time in the Company's ongoing filings. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. In light of these risks, uncertainties and assumptions, the forward-looking events in this press release might not occur.

"Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.