Starcore International Ventures Ltd.

Starcore International Ventures Ltd.

February 02, 2007 06:00 ET

Starcore Closes U.S. $26 Million Acquisition From Goldcorp/Luismin

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - Feb. 2, 2007) -


Starcore International Ventures Ltd. (the "Company") (TSX VENTURE:SAM) is pleased to announce that it has completed its previously announced acquisition (the "Acquisition") of Compania Minera Pena de Bernal, S.A. de C.V. ("Bernal"), the owner of the San Martin Mine in Queretaro, Mexico, from Luismin, S.A. de C.V. ("Luismin"), a wholly-owned subsidiary of Goldcorp Inc. In connection with the Acquisition, the Company has paid US$24 million and issued 4,729,000 common shares to Luismin. The shares are subject to a hold period expiring June 1, 2007. Bernal became a subsidiary of the Company's subsidiary, Starcore Mexicana, S.A. de C.V., effective February 1, 2007. With the completion of the Acquisition, Starcore is now, through its wholly-owned subsidiary, the owner of producing mining assets in Mexico. The Company previously received approval to graduate to Tier 1 of the TSX Venture Exchange (the "Exchange"). Effective February 6, 2007, the shares of the Company will commence trading on Tier 1. The Company's trading symbol will remain "SAM". Tier 1 is the Exchange's premier tier and is reserved for the Exchange's most advanced issuers with the most significant financial resources.

The San Martin mine, located 50 km east of the city of Queretaro, is composed of two mines (San Jose and San Martin) which have been operational since 1993. For a more detailed description of the San Martin property, please see the Technical Report on the San Martin Project, Mexico dated September 27, 2006, prepared by Watts, Griffis and McOuat Limited, as filed on SEDAR.

The Acquisition was funded, in part, through a private placement of 37.4 million subscription receipts (each a "Subscription Receipt") at a price of $0.50 per Subscription Receipt for gross proceeds of $18.7 million (the "Offering"). With the completion of the Acquisition, the conditions to the conversion of the Subscription Receipts were satisfied and each Subscription Receipt was deemed to have been converted into one common share (the "Common Shares") and one-half of one share purchase warrant (a "Warrant"). Each full Warrant is exercisable into one additional common share of the Company for a period of three years from the closing of the Offering at an exercise price of $0.80. The Warrants include an early expiry feature which may be triggered should the common shares close above $2.50 over a minimum period of forty-five calendar days. 22,173,200 of the Common Shares are subject to a hold period expiring May 19, 2007.

The balance of the funding was provided by a US$13,000,000 bank financing (the "Loan") from Investec Bank (UK) PLC ("Investec"). The loan matures on January 31, 2013 and bears interest at LIBOR plus 3%. In connection with the Loan, the Company issued to Investec detachable warrants (the "Loan Warrants") exercisable to acquire common shares in the capital of the Company (each a "Warrant Share") as follows: 12,442,000 Warrant Shares at a price of Cdn$0.76 (or US$0.643) per share exercisable until January 31, 2011 and 6,794,000 warrants exercisable for five years at a price of Cdn$0.87 (or US$0.736), and for a further period of one year if any of the Loan remains outstanding at a price equal to the greater of Cdn$0.87 (or US$0.736) and 160% of the volume weighted average trading price of the Company's common shares for the five business days before January 31, 2012. The Loan Warrants and any Warrant Shares issued upon exercise of the Loan Warrants are subject to a four-month hold period expiring June 1, 2007.

Pursuant to the Loan, the Company has entered into a forward sales agreement for the sale of 81,876 ounces of gold at a price of US$731 per ounce. The sales of approximately 1,135 ounces per month will occur over the period of the Loan from February 28, 2007 to January 31, 2013.

Chief Executive Officer Robert Eadie stated, "The acquisition of the San Martin Mine is the culmination of our efforts to make Starcore a producer."


Robert Eadie, Chief Executive Officer and Director

This news release does not constitute an offer to sell or a solicitation of an offer to sell any of the securities in the United States. The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act") or any state securities laws and may not be offered or sold within the United States or to U.S. Persons unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.

The TSX Venture Exchange has not reviewed nor does it accept responsibility for the adequacy or accuracy of this press release.

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