SilverBirch Signs Red Mile Merger Agreement



    Latest addition will create one of Canada's leading video game companies

    TORONTO, Oct. 9 /CNW/ - SilverBirch Inc. (TSX-V: SVB), a leading digital
media company, today announced that it has signed its merger agreement with
Red Mile Entertainment, Inc. Red Mile is a California-based video game
publisher with worldwide rights to established brands and intellectual
properties including the "Heroes" flight combat franchise. Heroes of the
Pacific sold over 600,000 copies and the sequel, Heroes Over Europe is
expected to ship in March of 2009.
    "We are on track in building a multi-platform world-wide video game
publishing presence," commented Derek van der Plaat, CEO of SilverBirch. "Red
Mile is expected to contribute meaningful revenues and cashflow in this fiscal
year."
    The boards of directors of both companies have approved the merger
agreement; however the transaction is still subject to TSX-V exchange
approval, US regulatory and Red Mile shareholder approval and is expected to
close in January of 2009.
    In other news, the Company is pleased to announce that the book of orders
for the $500,000 financing at $0.08 per unit is completed and expected to
close on or about October 10, 2008. In addition, pursuant to employment
agreements arising from the Lighthouse Interactive acquisition, the Board of
Directors have now approved grants of Stock Options to the former principals
of Lighthouse, totalling 300,000 options to acquire common shares of the
corporation at a strike price of $0.28. The options expire on July 8, 2013 and
are granted in accordance with the Employee Incentive Stock Option plan
approved by shareholders on May 27, 2008.

    About SilverBirch Inc.

    Toronto-based SilverBirch Inc. is a leading digital media company
operating in the fastest growing sectors of the video game and mobile markets.
 The company's video game operations include SilverBirch Studios, a mobile and
handheld video game developer, Lighthouse Interactive, a publisher of
interactive entertainment based in the Netherlands, and a co-venture with
G4Box Inc. to operate licensed English language online multiplayer games. In
its mobile division it provides mobile marketing services through Jambo Mobile
Solutions and mobile content by way of an investment in CrossRoad Mobile. For
more information see www.silverbirchinc.com.

    Cautionary Notes:

    As noted above, completion of the transaction is subject to a number of
conditions, including but not limited to, acceptance by the TSX Venture
Exchange.  The transaction cannot close until the required approvals have been
obtained. There can be no assurance that the transaction will be completed as
proposed or at all.

    
    The TSX Venture Exchange has in no way passed upon the merits of the
    proposed transaction and has neither approved nor disapproved the
    contents of this news release.  The TSX Venture Exchange does not accept
    responsibility for the adequacy or accuracy of the content of this news
    release.
    

    Forward-Looking Statements - Certain information set forth in this news
release contain forward-looking statements that involve substantial known and
unknown risks and uncertainties. These forward-looking statements are based
upon management's expectations, assumptions and beliefs, which may prove to be
incorrect.  These forward-looking statements are subject to numerous risks and
uncertainties, which may cause actual results to differ materially from
results expressed or implied by such forward-looking statements. These risks
and uncertainties, certain of which are beyond management's control, include
completion of the proposed transaction, the impact of general economic
conditions, industry conditions, and currency fluctuations. There can be no
assurance that forward-looking statements will prove to be accurate, as actual
results and future events could differ materially from those anticipated in
such statements.  Readers are cautioned that the assumptions used in the
preparation of such information, although considered reasonable at the time of
preparation, may prove to be imprecise and, as such, undue reliance should not
be placed on forward-looking statements.

    %SEDAR: 00020946E




For further information:

For further information: Derek van der Plaat, Chief Executive Officer,
SilverBirch Inc., Tel: (416) 621-6711 Ext 34, Email: derek@silverbirchinc.com;
Paul Haber, SVP & Chief Financial Officer, SilverBirch Inc., Tel: (416)
621-6711 Ext 35, phaber@silverbirchinc.com

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SILVERBIRCH INC.

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