Kinbauri Gold Corp.: Update on Glen Eagle Transaction and Legal Action

OTTAWA, ONTARIO--(Marketwire - June 05, 2009) - Kinbauri Gold Corp. ("Kinbauri") (TSX VENTURE: KNB) (FRANKFURT: 3KG.DE) announces that, after a review of materials provided by Glen Eagle Resources Inc. ("Glen Eagle") (TSX VENTURE: GER) with respect to the funding commitments relating to the proposed transaction between Glen Eagle and Kinbauri, the directors of Kinbauri advised Glen Eagle that they did not receive sufficient comfort that the new funding arrangements necessary to complete the transaction were available. After carefully considering the information provided by Glen Eagle in the context of the takeover bid by Orvana Minerals Inc. ("Orvana") and the application by Jaguar Financial Corporation ("Jaguar") Kinbauri advised Glen Eagle that the agreement between the parties had come to an end. Glen Eagle has advised that it does not accept Kinbauri's position and is considering its options. As a result, Kinbauri has decided to allow the matter to be determined in a court of law at the same time as the application brought by Jaguar scheduled to be heard on June 17, 2009. The special committee of independent directors (the "Special Committee") continues to evaluate the takeover bid commenced by Orvana Minerals Corp., consider other alternatives and will make a recommendation to the board of directors in the near future. Kinbauri expects to mail its directors' circular containing its recommendation next week. Jaguar has amended its application commenced in the Ontario Superior Court of Justice against Kinbauri, its wholly-owned subsidiary, Kinbauri Espana S.L., ("Espana"), the directors of Kinbauri, Glen Eagle and Paradise Peaks Holdings to request that: the board of directors of Kinbauri be removed and a new board be appointed; and an investigation be commenced to determine the ultimate source and terms of funding to be provided for the proposed transaction with Glen Eagle. In the interim, Kinbauri encourages shareholders not to take any action with respect to the offer. This press release contains certain forward-looking statements, which are based on the opinions and estimates of management at the date the statements are made, and are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected. Kinbauri undertakes no obligation to update forward-looking statements if circumstances or management's estimates or opinions should change. The reader is cautioned not to place undue reliance on forward-looking statements. VISIT: Kinbauri Gold's Hub at where investors can post questions and receive answers or review questions and answers already posted by other investors. Kinbauri Web-Site: THIS PRESS RELEASE WAS PREPARED BY KINBAURI GOLD CORP. NEITHER TSX VENTURE EXCHANGE NOR ITS REGULATION SERVICES PROVIDER (AS THAT TERM IS DEFINED IN THE POLICIES OF THE TSX VENTURE EXCHANGE) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE. Contacts: Kinbauri Gold Corp. North America - Dr. Vern Rampton, P. Eng. President 613-836-2594 613-831-2730 (FAX) This announcement was originally distributed by Hugin. The issuer is solely responsible for the content of this announcement.