Malaspina Capital: Proposed Acquisition of Alcell Technologies Inc. Terminated.

VANCOUVER, British Columbia--(BUSINESS WIRE)--May 26, 1998-- Malaspina Capital Ltd. (Alberta Stock Exchange:MLA.) Malaspina Capital Ltd. ("Malaspina") announced today that it has terminated its efforts to complete the proposed acquisition of Alcell Technologies Inc. ("Alcell") from Repap Enterprises Inc. ("Repap") due to an inability to meet the terms of the Letter of Intent signed on October 27, 1997 within the required timeframe. A request to Repap for a further extension of this agreement was denied.

The terms of the Letter of Intent, as mutually extended, included a requirement for Malaspina to raise a minimum of $10,000,000 prior to Closing, with a deadline of May 22, 1998. Despite an extremely thorough fundraising effort in both Asia and North America, Malaspina was unable to complete the minimum required fundraising due to the perceived current adverse market conditions, particularly in Asia.

The Board of Directors of Malaspina wishes to sincerely thank the employees of Alcell, the management of Repap and the various other parties connected with this transaction for their support during this project.

As a result of the termination of this acquisition, Malaspina intends to pursue alternate investment opportunities in order to complete a major transaction as required pursuant to Alberta Securities Commission Policy 4.11. Malaspina Capital Ltd. is a junior capital pool company listed on The Alberta Stock Exchange (trading symbol MLA.A). -0-

The Alberta Stock Exchange has neither approved nor disapproved of the information contained herein.

CONTACT: Malaspina Capital Limited

Craig T. Lindsay and/or Sean Mitchell, 604/687-8518

in North America

or

Malaspina Capital Limited

John R. Henderson, 852/2524-6078

852/2810-6265 (FAX)

in Asia