Selkirk Metals Corp.
TSX VENTURE : SLK

Selkirk Metals Corp.

March 01, 2007 20:14 ET

Selkirk Metals and Doublestar Resources to Merge to Accelerate Development of their Flagship Ruddock Creek Property

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - March 1, 2007) - Selkirk Metals Corp. ("Selkirk") (TSX VENTURE:SLK) and Doublestar Resources Ltd. ("Doublestar") (TSX VENTURE:DSR), joint venture partners since 2004 in the Ruddock Creek zinc-lead property 100 kilometers north of Revelstoke, announce today that they have executed a binding letter of intent intended to merge their businesses. The combined assets of both companies, should the merger proceed as currently planned, would result in approximately $14 million in current assets and a strong suite of B.C. base metal mineral projects.

The merger is expected to proceed based on a court-approved plan of arrangement under the British Columbia Business Corporations Act (the "Transaction").

Under the terms of the Transaction, it is proposed that each existing Class "A" share of Doublestar will be exchanged for one-half of one common share of Selkirk. In addition, all existing warrants of Doublestar and the outstanding stock options of Doublestar held by certain employees will be exchanged for economically equivalent warrants and options of Selkirk, based upon the same exchange ratio described above.

Gordon Keevil, President of Selkirk, stated, "This transaction, which is financially positive to Selkirk, will consolidate the working interest in the Ruddock Creek Property putting Selkirk in a much stronger position to advance its exploration and ultimate development. Furthermore, Selkirk looks forward to the addition of Doublestar's excellent portfolio of properties, which will enhance our already strong and diverse property base. We will continue to aggressively advance all of these properties to create greater value for our shareholders, including those we are inheriting from Doublestar through this transaction. We are also looking forward to working on an ongoing basis with the management of Doublestar to achieve the best possible results on behalf of the shareholders of both Selkirk and Doublestar."

Alan Savage, Chief Executive Officer of Doublestar, said, "Doublestar's board of directors fully supports the Selkirk proposal. This transaction can effect enhanced shareholder value for both companies by placing the world-class potential of the Ruddock Creek zinc-lead deposit under one roof. In addition, the combination of Doublestar's other resource assets, including the large Catface copper deposit, with those of Selkirk will create one of the strongest base metal mineral deposit portfolios in British Columbia. We are extremely optimistic for a positive outcome for shareholder value based on this transaction, and I look forward to working with the board of directors of Selkirk in that regard."

Completion of the Transaction, which is expected to occur in late June 2007, is subject to a number of conditions, including:

(a) satisfactory completion of due diligence by both parties and execution of a definitive agreement by no later than March 31, 2007;

(b) receipt of all necessary shareholder, court, regulatory and third party approvals; and

(c) the absence of any material adverse change in the business of either Selkirk or Doublestar.

The parties intend to work towards executing a definitive agreement by no later than March 31, 2007 and will, thereafter, prepare a formal information circular describing the Transaction in more detail and deliver that circular to all shareholders of Doublestar, who will be asked to approve the Transaction at a meeting expected to be held in mid June 2007. The approval of Selkirk shareholders is not expected to be required in order to complete the Transaction.

All directors and officers of Doublestar (and their respective affiliates and associates) have, in their capacities as shareholders of Doublestar, entered into, or have agreed to enter into, support agreements with Selkirk pursuant to which they will support the Transaction and vote all shares of Doublestar held by them in favour of the Transaction.

Selkirk and Doublestar will keep shareholders updated on the progress of the Transaction as developments warrant.

On Behalf of the Board of Directors of Selkirk Metals Corp.:

Gordon Keevil, President

On Behalf of the Board of Directors of Doublestar Resources Ltd.:

Alan Savage, Chief Executive Officer

This release includes certain statements that may be deemed to be "forward-looking statements" within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. All statements in this release, other than statements of historical facts, that address future production, reserve potential, exploration and development activities and events or developments that management of Selkirk and Doublestar expects, are forward-looking statements. Although management believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance, and actual results or developments may differ materially from those in the forward-looking statements. Factors that could cause actual results to differ materially from those in forward-looking statements include market prices, exploration and development successes, continued availability of capital and financing, and general economic, market or business conditions. Please see the public filings of both Selkirk and Doublestar at www.sedar.com for further information.

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or the accuracy of the contents of this press release.

Contact Information

  • Selkirk Metals Corp.
    Gordon Keevil
    President
    (604) 687-2038
    (604) 687-3141 (FAX)
    Website: www.selkirkmetals.com