(Source: PRNewswire)VANCOUVER and TORONTO, June 1 /PRNewswire-FirstCall/ - New Gold Inc. (TSX and NYSE Amex: NGD) ("New Gold") and Western Goldfields Inc. (TSX: WGI and NYSE Amex: WGW) ("Western Goldfields") are pleased to announce that they have completed their previously announced business combination (the "Transaction"). The Transaction was completed by way of a plan of arrangement (the "Plan of Arrangement") that was approved by the New Gold and Western Goldfields shareholders on May 13 and 14, 2009, respectively and which received final court approval on May 27, 2009.

"The closing of this transaction represents another significant step for New Gold as we continue to deliver on our growth strategy which we had promised our shareholders approximately one year ago," said Robert Gallagher, President and Chief Executive Officer of New Gold. "We are excited to bring the Mesquite Mine into our portfolio of assets as we continue to focus on growth by enhancing our operations, continuing the development of New Afton and pursuing strategic acquisition opportunities."

Randall Oliphant, Executive Chairman added, "As we now have the company fully funded, New Gold finds itself in a strong position, with growing production and cash flow enabling it to become the leading intermediate gold producer".

Pursuant to the Plan of Arrangement, New Gold acquired all of the issued and outstanding common shares of Western Goldfields in consideration for the issuance by New Gold of one common share of New Gold and Cdn$0.0001 for each Western Goldfields common share outstanding. All of the stock options of Western Goldfields outstanding at the effective time of the arrangement were replaced by options to purchase common shares of New Gold. All outstanding warrants to acquire common shares of Western Goldfields will, pursuant to their terms, be exercisable for common shares of New Gold and the nominal cash consideration.

Pursuant to the plan of arrangement, New Gold has issued an aggregate of approximately 143 million common shares of New Gold to the former shareholders of Western Goldfields and authorized the issuance of an additional 12 million common shares upon the exercise of the stock options and warrants held by the former security holders of Western Goldfields. As at June 1, 2009, following completion of the Transaction, there are approximately 356 million issued and outstanding common shares of New Gold.

The TSX will disseminate a notice announcing the delisting of the Western Goldfields shares. Upon notification of the closing of the Transaction, the NYSE Amex will suspend trading of the Western Goldfields shares and the NYSE Amex will file a Form 25. Western Goldfields shareholders should send in their completed and executed letters of transmittal and Western Goldfields share certificates to New Gold's transfer agent, Computershare Trust Company of Canada as soon as possible in order to receive the consideration to which they are entitled pursuant to the arrangement. A copy of the letter of transmittal is available on SEDAR at www.sedar.com under the Western Goldfields profile.