MDV Megastar Development Corp

Megastar Development Corporation ("Megastar", the "Company" or "MDV") (TSX
VENTURE:MDV)(FRANKFURT:M5Q) today updated shareholders regarding the status of
its recently announced plan of arrangement and dividend distribution of
70,000,000 common shares of Eloro Resources Ltd. 


The plan of arrangement was approved by special resolution of the shareholders
on December 20, 2010 and received requisite approval of the Supreme Court of
British Columbia under Section 288 of the British Columbia Corporations Act on
December 21, 2010. The plan of arrangement has been initiated and, upon
completion, will result in the distribution of 70,000,000 shares of Eloro
Resources Ltd. to Megastar shareholders of record at close of markets on January
7, 2011. Based on a total of 42,127,233 outstanding and issued common shares in
the capital stock of Megastar on January 7, 2011, the ratio of distribution will
be approximately 1.6616329869 Eloro shares for each Megastar share. The
Ex-dividend date, the date as of which a purchaser of Megastar common shares is
no longer entitled to receive Eloro shares pursuant to the arrangement, is
January 5, 2011. 


The 70,000,000 shares of Eloro Resources to be distributed by Megastar were
transferred into escrow on November 18, 2010. On February 3, 2011 the TSX
Venture Exchange announced its final acceptance of the sale and acquisition of
the Simkar property. The release from escrow of the Acquisition Closing
Documents and the Eloro shares, and distribution of the Eloro shares remains
subject to Eloro's receipt of confirmation from the Minister of Natural
Resources and Wildlife (Quebec) that the transfer of title to the Simkar
property from Megastar to Eloro has been registered. Although it is not known
when confirmation of the registration will be issued, Eloro expects it will be
completed shortly. Megastar will notify shareholders when a distribution date
for the dividend is determined. 


ABOUT MEGASTAR DEVELOPMENT CORP.

Megastar Development Corp. is an emerging resource company engaged in the
acquisition, exploration and development of mineral properties in Canada.
Megastar owns gold and base metal properties in Quebec and British Columbia. For
further information, investors and shareholders are invited to visit the
Company's website at www.megastardevelopment.com.


ON BEHALF OF THE BOARD OF DIRECTORS

Dusan Berka, P. Eng., President & CEO

Statements made in this news release that are not historical facts are
"forward-looking statements", and readers are cautioned that any such statements
are not guarantees of future performance, and that actual developments or
results, may vary materially from those in these "forward-looking" statements.

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