Maple Leaf Signs LOI to Acquire Private Yellowhorn Plantation Company

(TSX-V: MPE)

Last Close: May 27, 2011 - $0.075                           
Shares Issued: 80,682,875

CALGARY, May 30, 2011 /CNW/ - Maple Leaf Reforestation Inc. ("Maple Leaf") is pleased to announce that it has signed a Letter of Intent (the "LOI") to acquire all of the assets or all of the issued and outstanding shares of KS Ecology (Canada) Inc. ("KS"), a Vancouver-based private Yellowhorn plantation company.  The LOI stipulates that Maple Leaf and KS shall complete a definitive agreement on or before June 30, 2011 (the "Definitive Agreement").

The LOI has been filed on www.sedar.com as a "Material Document".

About KS

KS is a private Canadian company that has 100% ownership in two plantations in China, one in the city of JiaoZuo, Henan Province and one in the city of Beijing (the "Plantations").  The Plantations consist of 1,055 acres of land and contain 2,622,000 Yellowhorn trees that are in various stages of growth, and 6,000,000 Chinese Pistache trees, whose seed is another type of feedstock for Bio-Diesel production.

From its own Yellowhorn oil supply, KS has been producing a small quantity of Yellowhorn cooking oil, bio-diesel, tea and other products that serve a medical purpose, and marketing such products under the KS brand name throughout China.  KS has indicated that it is in the process of negotiating various deals and partnerships in China that would give it access to an additional 8,500 acres of land containing 3 million more Yellowhorn trees, and effectively giving it a dominant position with respect to the Yellowhorn supply source in China.

Preliminary Terms of Definitive Agreement

Maple Leaf and KS anticipate that the following terms will comprise the core aspects of the Definitive Agreement:

  1. The Plantations will be valued at approximately $2.7 to $3 million Cdn (16.8 million Rmb to 18.6 million Rmb), which will be subject to adjustment if KS secures additional land and/or Yellowhorn seedlings and trees;
  2. The acquisition of KS's shares or its assets by Maple Leaf will be satisfied primarily by Maple Leaf issuing common shares to KS from its treasury at a deemed per share value to be negotiated by Maple Leaf and KS;
  3. KS's management team will become members of Maple Leaf's team and will assist Maple Leaf with developing the Yellowhorn/bio-diesel project, obtaining financing for development of the project and increasing investor awareness of Maple Leaf in the China market; and
  4. Closing of the transaction contemplated by the Definitive Agreement will be subject to satisfactory due diligence at the sole discretion of Maple Leaf.

Raymond Lai, Maple Leaf's President & C.E.O comments, "We are eager to close a deal with KS given that they have an existing inventory of Yellowhorn trees, access to Yellowhorn oil and a very sound understanding of the Yellowhorn market in China and what it will take to expand the Yellowhorn plantations aggressively and rapidly.  KS is also eager to partner with Maple Leaf to take advantage of our public company platform and 'name-brand' and our existing connections to the Yellowhorn and bio-diesel markets in Canada, U.S. and Europe.  With their management team joining forces with us, we will formulate a business plan to develop the Yellowhorn for the Bio-Diesel and cooking oil industries in both China and Canada as soon as we are able to close the transaction."

About Maple Leaf Reforestation Inc. 

Maple Leaf is a Canadian company that focuses in the environmental industry with 2 main operating arms:

  1. Eco-Agriculture - it operates a large-scale nursery business in Inner Mongolia, China that is focused on growing value-added tree seedlings and nursery products that assist with anti-desertification.

  2. Renewable Energy - it is undertaking to commence a Yellowhorn seedling and tree operation which would provide valuable Yellowhorn seeds and ultimately oil from such seeds for the manufacture of bio-diesel fuel and premium healthy cooking oil.

Maple Leaf is a wholly-owned foreign enterprise which allows the Company to control 100% of the direction and operations of the company in China while permitting the cash generated from operations in China to flow back to Canada. 

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

Certain statements in this news release including (i) statements that may contain words such as "anticipate", "could", "expect", "seek", "may" "intend", "will", "believe", "should", "project", "forecast", "plan" and similar expressions, including the negatives thereof, (ii) statements that are based on current expectations and estimates about the markets in which Maple Leaf operates and (iii) statements of belief, intentions and expectations about developments, results and events that will or may occur in the future, constitute "forward-looking statements" and are based on certain assumptions and analysis made by Maple Leaf. Forward-looking statements in this news release include, but are not limited to, statements with respect to future capital expenditures, including the amount, nature and timing thereof; other development trends within the China's seedling industry; business strategy; expansion and growth of Maple Leaf's business and operations and other such matters. Such forward-looking statements are subject to important risks and uncertainties, which are difficult to predict and that may affect Maple Leaf's operations, including, but are not limited to: the impact of general economic conditions; industry conditions; government and regulatory developments; seedling product supply and demand; competition; and Maple Leaf's ability to attract and retain qualified personnel. Maple Leaf's actual results, performance or achievements could differ materially from those expressed in, or implied by, these forward-looking statements and, accordingly, no assurance can be given that any of the events anticipated by the forward-looking statements will transpire or occur, or if any of  them do transpire or occur, what benefits Maple Leaf will derive there from.

Maple Leaf maintains a forward-looking statement database which is reviewed by management on a regular basis to ensure that no material change has occurred with respect to such forecasts.  The Company will publicly disclose such material changes to its forward-looking statements as soon as they are known to management.

SOURCE Maple Leaf Reforestation Inc.

For further information:

regarding Maple Leaf Reforestation Inc., visit www.mlreforestation.com or contact:

Maple Leaf Reforestation Inc.
Raymond Lai, Chairman, President & CEO
Tel: +1 (403) 668-7560
Fax: +1 (403) 250-2534
E-mail: rlai@mlreforestation.com

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Maple Leaf Reforestation Inc.

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