Archangel Diamond Corporation

Archangel Diamond Corporation

May 20, 2009 10:30 ET

Archangel Approves Commencement of Re-Structuring

TORONTO, ONTARIO--(Marketwire - May 20, 2009) - Archangel Diamond Corporation ("ADC") (TSX VENTURE:AAD) announces that is has approved the commencement of discussions with Cencan S.A., ADC's majority shareholder, concerning a proposal from Cencan to provide financing support to ADC by way of a re-structuring of ADC under the provisions of the Bankruptcy and Insolvency Act (the "BIA").

Pursuant to such proposal, ADC would appoint a trustee to assist with its submissions to regulators and its discussions with Cencan and any other party that may make an alternative financing proposal.

ADC is continuing to seek alternative proposals from any other interested parties.

The Corporation confirms that there are no insolvency proceedings against it as of the date of the news release, and that there are no other material updates concerning the affairs of Archangel since the issuance of the News Release dated April 29, 2009.

This news release shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of the securities in any state in which such offer, solicitation or sale would be unlawful.

CAUTIONARY NOTE TO SHAREHOLDERS CONCERNING FORWARD LOOKING STATEMENTS AND FINANCIAL PROJECTIONS - This news release contains "forward-looking statements", within the meaning of applicable Canadian securities legislation. Forward-looking statements include, but are not limited to, statements with respect to the outcome of future negotiations, completion of the Transaction, execution of definitive agreements, exercise of future call rights, success of financing activities, identification or upgrade of mineral resources, requirements for additional capital, government regulation, results of future diamond exploration, results of diamond marketing, changes in legal requirements, changes in the political environment, environmental liabilities and title disputes. Generally, these forward-looking statements can be identified by the use of forward-looking terminology such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or state that certain actions, events or results "may", "could", "would", "might" or "will be taken", "occur" or "be achieved". Forward-looking statements are subject to known and unknown risks, uncertainties and other factors that may cause the actual outcomes, results, level of activity, performance or achievements of Archangel Diamond Corporation to be materially different from those expressed or implied by such forward-looking statements, including but not limited to: risks described in the above news release; those risks set out in Archangel's disclosure documents and its annual, interim management discussion and analysis and annual reports. Although Archangel has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking statements, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements. Archangel does not undertake to update any forward-looking statements or financial projections, except in accordance with applicable securities laws.

Neither the 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 news release.

Contact Information