MagIndustries Corp.

MagIndustries Corp.

August 18, 2006 13:25 ET

MagIndustries Announces Completion of $20.2 Million Private Placement of Common Shares

TORONTO, ONTARIO--(CCNMatthews - Aug. 18, 2006) - This news release does not constitute an offer to sell or a solicitation of an offer to buy 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 an exemption from such registration is available.

MagIndustries Corp. (the "Company") (TSX VENTURE:MAA) is pleased to report that it has completed its previously announced private placement (the "Offering") of common shares of the Company. Pursuant to the Offering the Company issued 14,420,858 common shares at an issue price of $1.40 per share for gross proceeds of approximately $20.2 million. Pursuant to applicable Canadian Securities laws and the policies of the TSX Venture Exchange, the hold period in respect of the common shares sold in the Offering will expire on December 19, 2006.

The Company retained Jennings Capital Inc. (as lead agent), Kingsdale Capital Markets Inc. and Ambrian Partners Ltd. (collectively, the "Agents") as agents in connection with the Offering. The Company agreed to pay the Agents a cash commission of 5% of the gross proceeds of the Offering and has issued broker warrants to the Agents entitling them to purchase common shares of the Company in an amount equal to 3% of the number of common shares sold under the Offering at an exercise price of $1.40 per share until August 18, 2007. The hold period for the broker warrants and the common shares issuable upon exercise thereof will expire on December 19, 2006.

The net proceeds of the Offering are to be used to fund ongoing development activities including MagMinerals' potash project feasibility study, expansion of MagEnergy's commitments at the Inga II Hydro-electric facility, a feasibility study for the "greenfield" hydroelectric site, Busanga and for general corporate purposes.

About MagIndustries Corp.:

MagIndustries' resource subsidiaries are operating and developing
major industrial projects in the Republic of Congo (ROC) and the
Democratic Republic of Congo (DRC).

- MagEnergy Inc., a wholly owned subsidiary, is the leading
participant in the refurbishment (Phase I) and rehabilitation
(Phase 2) of the generating capacity at the 1440MW Inga II
Hydroelectric station on the Congo River in the DRC. The Industrial
Development Corporation of South Africa holds a 30% interest in
Phase I and a 15% interest in Phase 2.

- MagForestry, a wholly owned subsidiary of MagIndustries, controls
100% of Eucalyptus Fibre Congo, an operating, 68,000 hectare
eucalyptus forest plantation which overlies MagIndustries Makola
Mineral License near Pointe-Noire, ROC.

- MagMinerals, a wholly owned subsidiary, is completing a bankable
feasibility study for the development of a 600,000tpy potash
(fertilizer) plant near Pointe-Noire, ROC.

- MagMetals, a wholly owned subsidiary, is planning the development
of a 72,000tpy magnesium smelter adjacent to MagMinerals' potash
plant for the production of magnesium alloys for the global
automotive industry. The raw materials for the MagMinerals and
MagMetals plants will be sourced by solution mining MagIndustries'
100% owned carnallite (magnesium and potash salt) deposits which
underlie the Makola Mineral License near Pointe-Noire.

- MagMining, currently a wholly-owned subsidiary, will be responsible
for the operation of the solution mine operation and the delivery
of the raw material brine to MagMinerals and MagMetals. The
government of the Republic of Congo may eventually hold a 10%
interest in this entity.

MagIndustries Corp. 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 170,518,384 shares outstanding on an undiluted basis, taking into account the aforementioned Offering. More information on the Company is available at its website,

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.

The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release.

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