Virgin Metals Adopts Shareholder Rights Plan and Provides Update on Activities



    TSX
    Symbol: VGM
    Shares Outstanding: 78,951,885

    TORONTO, Feb. 11 /CNW Telbec/ - Virgin Metals Inc. (TSX: VGM) ("Virgin
Metals" or the "Company") reports that the Board of Directors has adopted a
shareholder rights plan ("Rights Plan") effective February 11, 2008. The
Rights Plan is designed to provide adequate time for shareholders of Virgin
Metals and the Board of Directors to consider and evaluate any unsolicited
take-over bid for the Company; to provide the Board adequate time to identify,
develop and negotiate alternatives for maximizing shareholder value; to
provide shareholders with an equal opportunity to participate in any take-over
bid; to encourage the fair treatment of shareholders in the event of any bids
for Virgin Metals; and, to ensure that any proposed transaction is in the best
interest of Virgin Metals' shareholders. Virgin Metals is not aware of any
pending or threatened take-over bid for the Company.
    The Rights Plan is effective immediately subject to ratification by
Virgin Metals shareholders, which will be sought at the Annual and Special
Meeting of Shareholders which is expected to be held on or about May 6, 2008.
    The Rights Plan, which has a term of three years, is similar to those
adopted by other Canadian listed companies and is consistent with current
Canadian corporate practice and institutional investor guidelines. The Rights
issued under the Rights Plan will become exercisable only if a person,
together with its affiliates, associates and joint actors acquires or
announces the intention to acquire beneficial ownership of Virgin Metals
shares which when aggregated with its current holdings total 20% or more of
Virgin Metals' outstanding common shares (determined in the manner set out in
the Rights Plan), other than a Permitted Bid (as defined in the Rights Plan).
    A Permitted Bid must be made by way of a take-over bid circular prepared
in compliance with applicable securities laws, and, among other conditions,
must remain open for 60 days and may be taken up only if more than 50% of the
shares held by shareholders other than the bidder have been tendered to the
bid. In the event that the take-over bid does not meet the Permitted Bid
requirements of the Rights Plan, the Rights will entitle shareholders, other
than the shareholder making the take-over bid, to purchase additional common
shares of Virgin Metals at a substantial discount to the market price of the
common shares at that time.

    Update on Activities

    The Company is also providing the following update on activities at its
two 100% owned molybdenum/copper projects in Sonora, northern Mexico.
    At Los Verdes, the focus has been on finalizing the feasibility study
currently in progress. Many aspects of the study are complete, but numerous
details remain to be finalized and it may be several weeks before the report
is complete. Some issues remain in the areas of incorporation of historical
exploration data, updating of the resource model, mine planning and in
finalizing metallurgical parameters for the study but overall the study is
well advanced
    Our planned confirmatory metallurgical testwork by means of a pilot plant
proved to be impractical when the bulk sample of approximately 25 tonnes taken
from the adit had a molybdenum grade of 1.2%, about ten times the average
resource grade and therefore too high a grade to be considered as
representative or to provide reliable data for feasibility study design. As a
result, we embarked upon confirmatory testwork using core samples. We are
still awaiting results from locked cycle tests on these samples which will
give us final confirmation of recoveries that can be expected. Tests to date
indicate somewhat higher recoveries of copper than that expected from
preliminary tests and comparable molybdenum recoveries to bulk concentrate,
but we need to confirm the degree of losses, if any, in the cleaning circuit.
    Meanwhile, geological reconnaissance work and mapping within the
extensive VMI land package at Los Verdes has revealed several areas of
outcropping mineralization showing copper and molybdenum sulfides. Our
geologists are currently working toward developing additional drill targets in
the district.
    Virgin Metals president Chris Davie said: "I am very much aware that
feasibility study results were expected at about this time and appreciate the
effect on project schedule that this delay might have. However, all our work
to date has confirmed our expectations and we feel it is worth waiting for the
final details to put the results beyond question. We have worked with a number
of very busy industry professionals in this study and appreciate the time and
priority they have given to our work."
    At Cuatro Hermanos, we are again in the holding pattern of waiting for
assay results. Before Christmas we drilled five holes in the vicinity of a
small conical hill at the western edge of the property which showed an
historic geochemical molybdenum high and we look forward to receiving results
from this area. The drill is currently back in the main zone, continuing the
infill drilling in that area that we started in the latter half of last year.
    Meanwhile, a ground geophysics program is under way at the property, with
a view to determining structural orientation and possible deep targets for
higher grade copper mineralization. It is anticipated that this will be
followed up by a deep drilling program in the second or third quarter of this
year.

    About Virgin Metals

    Virgin Metals is a junior exploration and development company; its
projects include two copper-molybdenum porphyry properties in Sonora, northern
Mexico. One of these, Los Verdes, is undergoing a feasibility study and is
expected to evolve rapidly towards production while the other, Cuatro
Hermanos, is presently the focus of an intense exploration effort.

    FORWARD-LOOKING STATEMENTS

    This press release includes certain "forward-looking information" within
the meaning of the Securities Act (Ontario), including, but not limited to,
statements as to timing and extent of exploration programs and the
availability of exploration results. As such, forward-looking information
addresses future events and conditions and so involves inherent risks and
uncertainties, as disclosed under the heading "Risk Factors" and elsewhere in
Virgin Metals documents filed from time to time with the Ontario Securities
Commission and other regulatory authorities. Actual results could differ
significantly from those currently projected as a result of, among those
factors, adverse weather, regulatory changes, delays in receiving permits,
accidents and delays in completing exploration activities not all of which are
in the control of Virgin Metals. The forward-looking information contained
herein is Virgin Metal's reasonable estimate today of future events and
conditions, but no assurance can be given that such events or conditions will
occur.




For further information:

For further information: Valerie Kimball, Investor Relations,
vkimball@virginmetals.com, (303) 703 1210; Renmark Financial Communications
Inc.: Barbara Komorowski, bkomorowski@renmarkfinancial.com; Neil Murray-Lyon,
nmurraylyon@renmarkfinancial.com; Media: Vanessa Napoli,
vnapoli@renmarkfinancial.com, (514) 939-3989, Fax: (514) 939-3717,
www.renmarkfinancial.com

Organization Profile

VIRGIN METALS INC.

More on this organization


Custom Packages

Browse our custom packages or build your own to meet your unique communications needs.

Start today.

CNW Membership

Fill out a CNW membership form or contact us at 1 (877) 269-7890

Learn about CNW services

Request more information about CNW products and services or call us at 1 (877) 269-7890