NewGrowth Corp - Capital Shareholders Approval of Capital Reorganization



    TORONTO, May 11 /CNW/ - NewGrowth Corp. (the "Company") announced today
that holders of its Class A Capital Shares ("Capital Shares") have
overwhelmingly approved a share capital reorganization (the "Reorganization")
allowing holders of Capital Shares, at their option, to retain their
investment in the Company after the scheduled redemption date of June 26,
2009. The Reorganization will permit holders of Capital Shares to extend their
investment in the Company beyond the redemption date of June 26, 2009 for up
to an additional 5 years. The Class B Preferred Shares will be redeemed on the
same terms originally contemplated in their share provisions and have been
called for redemption on June 26, 2009. In order to maintain the leveraged
"split share" structure of the Company, the Company expects to create and
issue a new series of Class B preferred shares on or about June 26, 2009.
    Holders of Capital Shares electing to retain their investment in the
Company will continue to enjoy the benefit of a leveraged participation in the
capital appreciation of the Company's portfolio (the "Portfolio") of common
shares (the "Portfolio Shares") of selected Canadian chartered banks,
telecommunication, utility and pipeline companies while deferring the
recognition of a substantial potion of capital gains which would otherwise be
realized on the redemption of their Capital Shares.
    The Reorganization will involve an adjustment of the Company's Portfolio
so that the Company provides broader exposure to Canadian chartered banks,
telecommunication, utility and pipeline companies and the Portfolio will be
rebalanced to an equal weight position in order to improve diversification and
mitigate single issuer exposure.
    Holders of Capital Shares who do not wish to continue their investment in
the Company after June 26, 2009 must give notice that they wish to exercise
their special retraction right and how they wish to be paid for their shares
on or prior to May 29, 2009. Holders of Capital Shares who retract their
Capital Shares will be paid on June 26, 2009. The Reorganization will become
effective provided that holders of at least 1,340,000 Capital Shares retain
their Capital Shares and do not exercise the special retraction right.

    %SEDAR: 00002585E




For further information:

For further information: Investor Relations, NewGrowth Corp., (416)
862-3931, E-mail: mc_newgrowth@scotiacapital.com, Web site:
www.scotiamanagedcompanies.com


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