Western Goldfields Board of Directors Approves Plan to Change Corporate Structure



    TORONTO, March 27 /CNW/ - Western Goldfields, Inc. (TSX:WGI, OTC
BB:WGDF.OB) (the "Company") today announced that its Board of Directors has
approved a plan to reorganize the Company's corporate structure so that its
place of incorporation will be changed from Idaho, USA to Ontario, Canada.
Under the plan, Western Goldfields Inc. ("WGI Ontario"), a newly formed
Ontario corporation, will become the parent company of the Company. The
proposal is subject to approval by the Company's shareholders at its annual
meeting.
    The Company's Board of Directors believes that the reorganization will
allow Western Goldfields to take advantage of financial and other business
opportunities that are not available under the current corporate structure,
including easier and quicker access to capital markets in Canada and the
United States and the ability to complete transactions requiring shareholder
approval more quickly.
    Upon completion of the reorganization, each share of the Company's common
stock will automatically become one WGI Ontario common share. The Company's
common stock is currently listed on the Toronto Stock Exchange under the
symbol "WGI" and quoted on the OTC Bulletin Board under the symbol "WGDF.OB"
and we expect that, following the reorganization, WGI Ontario shares will be
listed on the Toronto Stock Exchange and quoted on the OTC Bulletin Board. The
Company's shareholders' relative economic ownership will remain unchanged upon
completion of the reorganization, and WGI Ontario and its subsidiaries will
continue to conduct the business now conducted by the Company and its
subsidiaries.

    This announcement does not constitute an offer of any securities for
sale, or an offer or invitation to purchase any securities. In connection with
the proposed reorganization, a registration statement on form S-4 will be
filed with the Securities and Exchange Commission ("SEC") containing a form of
proxy statement/prospectus. Investors and security holders are urged to
carefully read the proxy statement/prospectus regarding the proposed
reorganization when it becomes available, because it will contain important
information. Investors and security holders may obtain a free copy of the
proxy statement/prospectus (when it becomes available) and other documents
containing information about the Company and WGI Ontario, without charge, at
the SEC's web site at www.sec.gov. Copies of the proxy statement/prospectus
and the SEC filings that will be incorporated by reference in the proxy
statement/prospectus may also be obtained for free by directing a request to:
Western Goldfields, Inc., 2 Bloor Street West, Suite 2102, P.O. Box 110,
Toronto, Ontario, Canada M4W 3E2, Attention: Julie Taylor, telephone: (416)
324-6000.
    The Company and its directors, executive officers and other members of
its management and employees may be deemed to be participants in the
solicitation of proxies from the Company's shareholders in connection with the
proposed merger. Information concerning the Company's participants in the
solicitation is set forth in the Company's proxy statements and annual reports
on Form 10-KSB, filed with SEC, and in the aforementioned proxy
statement/prospectus relating to the reorganization.

    Western Goldfields, Inc.
    ------------------------

    Under a new, highly experienced, and dynamic management team, Western
Goldfields is a gold producer focused on completing the expansion of its
wholly owned Mesquite Mine, located in Imperial County, California, and
returning the mine to full production. Western Goldfields, Inc. is listed on
the Toronto Stock Exchange and trades under the symbol WGI, and is quoted on
the OTCBB under the symbol WGDF.OB. For further details regarding the Company,
please visit www.westerngoldfields.com.

    Forward-Looking Information
    ---------------------------

    Certain statements contained in this news release may contain
forward-looking information within the meaning of the United States Private
Securities Litigation Reform Act of 1995 and similar Canadian legislation.
Such forward-looking statements are identified by words such as "intends",
"anticipates", "believes", "expects", and "hopes" and include, without
limitation, statements regarding the Company's plan of business operations,
financing options and the consequences thereof, potential contractual
arrangements, receipt of working capital, anticipated revenues, and related
expenditures. Some of the forward-looking statements contained in this
document include statements about the proposed reorganization, including
statements that the reorganization will allow the Company to take advantage of
financial and other business opportunities that are not available under the
Company's current corporate structure, including easier and quicker access to
capital markets in Canada and the United States, and the ability to complete
transactions requiring shareholder approval more quickly, and the listing and
quotation of WGI Ontario's shares. There can be no assurance that such
statements will prove to be accurate; actual results and future events could
differ materially from such statements. Factors that could cause actual
results to differ materially include, among others, those set forth in the
Company's Annual Report on Form 10-KSB for the year ended December 31, 2006
filed with the U.S. Securities and Exchange Commission and on www.SEDAR.com,
under the caption, "Risk Factors" and the in proxy statement/prospectus
regarding the proposed reorganization. Most of these factors are outside the
control of the Company. For example, if the Company does not receive the
required shareholder approval, the reorganization will not be consummated. In
addition, the Company may not realize all or any of the expected benefits of
the reorganization. Investors are cautioned not to put undue reliance on
forward-looking statements. Except as otherwise required by applicable
securities statutes or regulation, the Company disclaims any intent or
obligation to update publicly these forward-looking statements, whether as a
result of new information, future events or otherwise.

    For further details, please visit www.westerngoldfields.com




For further information:

For further information: Brian Penny, Chief Financial Officer, (416)
324-6002, bpenny@westerngoldfields.com; Julie Taylor Pantziris, Director,
Regulatory Affairs and Investor Relations, (416) 324-6015,
jtaylor@westerngoldfields.com; Richard Wertheim, Investor and Media Relations,
Wertheim + Company Inc., (416) 594-1600, wertheim@wertheim.ca

Organization Profile

WESTERN GOLDFIELDS INC.

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