Anaconda Mining Inc. and New Island Resources Inc. Complete Plan of Arrangement

TORONTO and ST. JOHN\'S, Jan. 14 /CNW/ - Anaconda Mining Inc. ("Anaconda") (TSX: ANX) and New Island Resources Inc. ("New Island") (TSXV: NIS) are pleased to announce that the previously announced plan of arrangement between the two companies has been completed (the "Arrangement").

The Arrangement, which was approved by special resolution and a majority of the minority of the New Island shareholders on January 11, 2011, received the final approval of the Alberta Court of Queen\'s Bench on January 13, 2011.

Pursuant to the Arrangement, which was effective at 12:01 a.m. (Calgary time) on January 14, 2011 (the "Effective Time"), New Island reorganized its share capital into Class A common shares ("New Island Class A Shares") and Class B convertible common shares ("New Island Class B Shares") and transferred all of its interest in the Pine Cove Mine and Mill and all future cash flows generated therefrom (the "Pine Cove Interest") to Anaconda in exchange for 11,307,827 common shares of Anaconda (the "Anaconda Shares"), on the basis of 0.45 of an Anaconda Share for each one common share of New Island outstanding immediately prior to the Effective Time (other than those held by Anaconda) (the "New Island Shares"). At the Effective Time, New Island immediately distributed the Anaconda Shares to its shareholders on the basis of 0.45 Anaconda Share for each New Island Share.

In addition, former shareholders of New Island (the "Tendered New Island Shareholders") who tendered their New Island Shares to Anaconda pursuant to Anaconda\'s takeover bid offer in the summer of 2010 (the "Offer") received an aggregate of 752,969 Anaconda Shares as a top up to the Anaconda Shares they previously received, on the basis of 0.03 of an Anaconda Share for each one New Island Share they tendered (being the difference between the 0.42 share exchange ratio pursuant to the Offer and the 0.45 share exchange ratio pursuant to the Arrangement).

At the Effective Time, 25,098,879 New Island Shares acquired by Anaconda pursuant to the Offer were initially exchanged for New Island Class B Shares and were then transferred to the Tendered New Island Shareholders on the basis of one New Island Class B Share for each of the New Island Shares they tendered to the Offer. Upon the transfer to the Tendered New Island Shareholders, the New Island Class B Shares were converted into an equal number of New Island Class A Shares.

In addition, at the Effective Time, all New Island Shares held by shareholders (other than Anaconda) were exchanged for New Island Class A Shares. The New Island Class A Shares are scheduled to commence trading on the TSX Venture Exchange as of January 14, 2011.

In addition to the 12,060,796 Anaconda Shares issued pursuant to the Plan of Arrangement, Anaconda had issued 10,541,520 Anaconda Shares pursuant to the Offer, for an aggregate total of 22,602,315 Anaconda Shares.

In order for the shareholders of New Island to receive their entitlement to the New Island Class A Shares and Anaconda Shares pursuant to Arrangement, they must deliver a completed Letter of Transmittal with their share certificate(s) and other required documentation to New Island\'s Depositary agent, CIBC Mellon Trust Company by no later than January 14, 2017 thereafter the New Island Shares will cease to represent a right to receive New Island Class A Shares or Anaconda Shares.


ABOUT ANACONDA

Anaconda is a Toronto, Canada-based mining and exploration company focused on operating the Pine Cove gold mine located near Baie Verte in Newfoundland, Canada and, with its joint venture partner, Inversiones SBX Limitada, advancing the development and exploration of its iron ore portfolio in Chile.


About New Island

New Island is a diversified junior exploration company holding gold and base metal properties in the Province of Newfoundland and Labrador. New Island has entered into an agreement for the sale of its interest in the gold mine and mill project at Pine Cove in central Newfoundland. Additional Information concerning this sale and New Island may be obtained on New Island\'s website at: www.newislandresources.com or from the System for Electronic Document Analysis and Retrieval (SEDAR) website at: www.sedar.com under New Island\'s profile.



FORWARD-LOOKING INFORMATION

This news release contains "forward-looking information" within the meaning of applicable Canadian securities laws. Forward-looking information includes, but is not limited to, information concerning the plan of arrangement between Anaconda and New Island and matters relating thereto. Generally, forward-looking information can be identified by the use of forward-looking terminology such as "plans", "expects", or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates", or "does not anticipate", or "believes" or variations of such words and phrases or statements that certain actions, events or results "may", "could", "would", "might", or "will be taken", "occur", or "be achieved". Forward-looking information is based on the opinions and estimates of management at the date the information is made, and is based on a number of assumptions and subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in the forward-looking information. Many of these assumptions are based on factors and events that are not within the control of Anaconda or New Island and there is no assurance they will prove to be correct. Factors that could cause actual results to vary materially from results anticipated by such forward-looking information include changes in market conditions, variations in ore grade or recovery rates, fluctuating metal prices, changes in project parameters, the possibility of project cost overruns or unanticipated costs and expenses, labour disputes and other risks of the mining industry, failure of plant, equipment or processes to operate as anticipated as well as those risk factors discussed in Anaconda\'s Annual Information Form for the year ended May 31, 2010 and New Island\'s Management Information Circular dated December 15, 2010, available at www.sedar.com. Although Anaconda and New Island have attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking information, there may be other factors that cause actions, events or results not to be anticipated, estimated or intended. There can be no assurance that forward-looking information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information Anaconda and New Island undertake no obligation to update forward-looking information if circumstances or management\'s estimates or opinions should change except as required by applicable securities laws. The reader is cautioned not to place undue reliance on forward-looking information.

This news release and the information contained herein does not constitute an offer of securities for sale in the United States and securities may not be offered or sold in the United States absent registration or exemption from registration.

Neither the 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.



For further information:

Anaconda Mining Inc.
Dustin Angelo
President and CEO
Tel: (647) 260-1248
Email: dangelo@anacondamining.com
Website: www.anacondamining.com

New Island Resources Inc.
Harold Wareham
President
Tel: (709) 576-7711
Email: info@newislandresources.com
Website: www.newislandresources.com