Friday, August 26th, 2011 -‐ VICTORIA, BC, CANADA -‐ Cancana Resources Corp. (TSXV: CNY) (the "Company" or "Cancana") announces that the TSX Venture Exchange, (“TSXV”), has approved the renegotiated acquisition of Amazon Resources Limited, ("Amazon").
On July 29, 2011 Cancana announced that it had successfully renegotiated the acquisition of Amazon. This renegotiation was agreed to by the Board of Directors of Amazon and the shareholders of Amazon who had originally accepted the Share Exchange Agreement ("SEA") proposed on November 22, 2010. The original SEA provided for Cancana to acquire 30% of Amazon in exchange for 4,504,255 common Cancana shares. The SEA also included an Option to acquire the balance of Amazon, but required that a minimum of 85% of the shares voted by Amazon shareholders accepted the SEA. This would have required that Cancana issue approximately a further 9,389,880 common shares, for a total share issuance of approximately 13,894,135 common shares of Cancana.
Cancana reopened negotiations for this transaction prior to the projected closing date of March 31, 2011 for the initial 30% acquisition of Amazon. Cancana proposed a revision to the SEA for 85.88% of the common shares of Amazon in exchange for 4,444,798 Cancana “the Shares”. Cancana also agreed to the establishment of a Net Smelter Royalty ("NSR") so as to provide for some additional deferred consideration to the shareholders of Amazon. The amount of the NSR is a total of 3%.
Pursuant to the rules of the TSXV, Cancana submitted the revised acquisition as an Expedited Acquisition. On Wednesday, August 24th, 2011 the TSXV approved this Expedited Acquisition and authorized the completion of the transaction and the issuance of the Shares.
With the Expedited Acquisition being completed, Cancana will now proceed to completion of its financing presentation, and commence it’s financing, which is scheduled for September 2011. This financing will enable Cancana, along with the rest of its corporate objectives, the ability to proceed with the commissioning of the diamond and gold processing facility at Parauna in Brazil, trial mining of Manganese and a drill program on the Dash property in B.C., Canada.
Cancana CEO, Dr. Bill Pfaffenberger states: "We are pleased to have received TSXV approval for this acquisition. As well we would like to reiterate that we are pleased that the Shareholders of Amazon accepted the revised acquisition valuation in order to allow this transaction to be processed in an Expedited manner with the TSXV. Overall we believe this will enable the Company to move forward more quickly and cohesively in an effort to being able to provide added asset value from day one.”
The Shares of Cancana being issued to Amazon shareholders in exchange for their 85.88% of Amazon will be placed under a three-‐year Surplus Escrow provision pursuant to TSXV rules. This was also a specific term within the revised SEA and will serve to provide continuity with the incoming Amazon shareholders.
Upon closing, which should occur in the coming weeks, Cancana will have 20,854,747 shares outstanding which amount includes the Shares issued to Amazon shareholders. Christopher Morgan, as an Insider by virtue of being a Director of both Cancana and Amazon, will receive 816,504 Cancana shares pursuant to the revised SEA.
Further to our December 20, 2010 News Release, Cancana has decided not to proceed with exercising the option to acquire 50% of Rio Madeira at this time and concentrate on commencing trial mining and early stage production on the high grade manganese opportunities it already holds in Rondonia, which currently represent 13,400.58 hectares of manganese bearing claims.
Cancana Resources Corp., formerly Sola Resource Corp., is an exploration stage company with assets in Brazil and Canada, has primarily focused on diamond, manganese and gold resource properties. Recently the Company has been seeking projects that expand its resource base and provide for near term production and revenue. All available resource reports and information on the Company’s properties are located on the Company website.
Cancana continues to provide shareholders with Investor Updates, please ensure that you have already registered on the company website, if not please visit www.cancanacorp.com and input your name and email address on the home page.
For further information about Cancana Resources Corp., please visit the Company’s website or contact the Company at +1 403 269 2065 or preferably email: email@example.com
Issued on behalf of the Board of Directors of Cancana Resources Corp.
Dr. William (Bill) Pfaffenberger CEO and Director