Avcorp signs definitive agreement to acquire composite design and manufacturing business

VANCOUVER, Oct. 10 /PRNewswire-FirstCall/ - With reference to a previous announcement made April 3, 2007, Avcorp Industries Inc. (Avcorp) is pleased to announce it has concluded an agreement to acquire the shares of Comtek Advanced Structures Ltd (Comtek). This will add ongoing operations and expertise in the design and competitive manufacture of advanced composite aerostructures, plus provide access to new aerospace markets for Avcorp. Closing is scheduled for the end of November 2007.

"The ability to offer integrated composite and metallic aircraft structures to aircraft manufacturers is a distinct advantage in the pursuit of contracts for new aircraft designs, which require light-weight, strong, reliable structures," states Paul Kalil, President. "This acquisition will add technology enabling Avcorp to reach it strategic goals. Comtek is expected to grow substantially with the addition of Avcorp's customer relationships and the combined ability to offer integrated solutions."

Comtek has invested in excess of CAD$7 million to develop advanced proprietary resin infusion technology. The first commercial application of this technology by Comtek has been utilized on the Airbus A380 program. Comtek has been in business for 13 years, has 90 employees of which 12 are engineers involved in research and product development operating out of Burlington, Ontario.

    The signed definitive agreement, negotiated at arm's length, provides
that:

    -  Avcorp will invest CAD$1.5 million into Comtek (CAD$200,000 in shares
       of Avcorp at a deemed value of $2.85 per share, and CAD$1.3 million
       for working capital), of which CAD$1.2 million has been advanced to
       date;

    -  The principals of Comtek will remain and have agreed to assign their
       shares to Avcorp for 500,000 Avcorp warrants, exercisable over a
       three-year period from closing, at an exercise price of $2.60 in
       year 1, $3.00 in year 2, and $3.50 in year 3; and

    -  Avcorp has agreed to pay to the principal shareholders of Comtek one-
       third of Comtek's EBITDA for the year ending December 31, 2010, which
       is payable two-thirds in cash and one-third in Avcorp shares at the
       then current market price.

With reference to a previous announcement made March 7, 2007, for the purchase of a machining business in B.C., Avcorp has decided not to proceed with this acquisition focusing instead on investing in its own machining capabilities.

About Avcorp

Avcorp designs and builds major airframe structures for some of the world's leading aircraft companies, including Boeing, Bombardier, and Cessna. With 50 years of experience, more than 650 skilled employees and a 300,000 square foot facility near Vancouver, Canada, the Company's depth and breadth of capabilities are unique in the aerospace industry for a company of its size. Avcorp is a Canadian public company traded on the Toronto Stock Exchange (TSX."AVP"). More information is available at www.avcorp.com.

    (signed)                        (signed)
    MARK VAN ROOIJ                  PAUL KALIL
    CHIEF EXECUTIVE OFFICER         PRESIDENT


    CONTACT: Sandi DiPrimo, Investor Relations Contact, (604) 587-4938