Sprott Molybdenum Participation Corporation Announces Proposed Distribution of Assets


    TORONTO, June 3 /CNW/ - (TSX: MLY, MLY.WT) - As previously announced, the
Corporation proposes to distribute all or substantially all of its assets to
its shareholders on or about July 9, 2009 (the "Distribution"). As part of the
Distribution, the Corporation has entered into an agreement with an arm's
length purchaser pursuant to which the Corporation will issue to the purchaser
a 10% secured convertible debenture with a principal amount of $1,350,000 (the
"Debenture"). The Debenture will have a maturity of one year and will be
convertible into Class A non-voting shares of the Corporation. The net
proceeds from the sale of the Debenture will be included in the proceeds
distributed to shareholders, but, as a non-shareholder, the holder of the
Debenture will not participate in the Distribution.
    In exchange for their common shares, shareholders of the Corporation will
receive a cash distribution of approximately $1.76 per share and one new
common share. This will permit the shareholders to receive a payment of cash
along with the opportunity to continue to hold an equity stake in the
Corporation. It is expected that the new common shares will be listed and
traded on the NEX board of the TSX Venture Exchange.
    Shareholders will be asked to vote on the proposed Distribution at the
annual and special meeting of shareholders of the Corporation scheduled for
June 30, 2009. Details regarding the Distribution will be contained in the
management information circular for such meeting, which will be mailed to
shareholders on or about June 9, 2009. Certain steps of the Distribution are
also subject to regulatory approval.
    Net asset value of the Corporation on May 29, 2009 was $1.73 per share of
which $1.72 per share was held in cash, accounts receivable and short term
securities, net of liabilities. Expected debenture proceeds of $1,350,000 are
not reflected in net asset value of the Corporation as at May 29, 2009. The
Corporation is continuing to liquidate its existing portfolio investments in
an orderly manner, subject to market conditions.

    Forward-Looking Statements

    Certain statements in this release are "forward-looking statements"
management's expectations regarding the Corporation's future growth, results
of operations, performance and business prospects and opportunities. Such
forward-looking statements reflect management's current beliefs and are based
on information currently available to management. Forward-looking statements
involve significant risks and uncertainties. A number of factors could cause
actual results to differ materially from the results discussed in the
forward-looking statements. Although the forward-looking statements contained
in this release are based upon what the Corporation and its manager, Sprott
Asset Management LP ( the "Manager"), believe to be reasonable assumptions,
neither the Corporation nor the Manager can assure investors that actual
results will be consistent with these forward-looking statements. These
forward-looking statements are made as of the date of this release, and
neither the Corporation nor the Manager assumes any obligation to update or
revise them to reflect new events or circumstances.

    About Sprott Molybdenum Participation Corporation

    The Corporation is an investment holding company created with the goal of
achieving capital appreciation by investing in securities of private and
public companies that explore for, mine and/or process molybdenum and by
investing in, holding, selling and otherwise transacting in all commercial
forms of molybdenum.

For further information:

For further information: Investor Services at 1-888-362-7172

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