Amazon Mining Holding Plc
TSX VENTURE : AMZ

Amazon Mining Holding Plc

April 09, 2009 15:07 ET

Amazon Announces Acquisition of the Brazilian Subsidiary of Toucan Metals Limited

TORONTO, ONTARIO--(Marketwire - April 9, 2009) -

NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES

Attention Business Editors:

Amazon Mining Holding Plc ("Amazon") (TSX VENTURE:AMZ) is pleased to announce that it has reached an agreement in principle (the "Agreement"), subject to all required approvals, whereby Amazon will acquire all of the shares of Uaua Pesquisa Mineral Ltda ("Uaua"), the wholly-owned Brazilian subsidiary of Toucan Metals Limited ("Toucan"), a privately-held Ontario corporation (the "Transaction").

Pursuant to the terms of the Agreement, Toucan will transfer all of its interest in Uaua to Amazon for an aggregate purchase price of CDN$287,147, which will be satisfied by the payment to Toucan of CDN $127,332 in cash consideration together with 853,712 common shares of Amazon ("Amazon Shares"). The Amazon Shares exchange ratio was based on the 20-day VWAP of CDN$0.1872 per share for the period ending March 27, 2009.

The principal activity of Uaua is that of a mineral exploration company engaged in the acquisition and development of base metals exploration properties in Brazil. Uaua currently holds a 100% interest in thirty four exploration licences, which provide mining rights to copper or zinc or vanadium on two properties in Brazil known as the "Tucano" and "Mimoso" projects.

Tucano Vanadium Project

The project is located in Bahia State approximately 277km southwest of Salvador City. Vanadium and uranium mineralization occur in the Mesozoic Sergi Formation of the Tucano Basin, associated with organic-rich and green colored clay alluvial sandstones. The primary mineral of interest is vanadium bearing oxides. Current Brazilian legislation establishes uranium as a federal monopoly.

Mimoso Copper/Zinc Project

The project is located approximately 438km northwest of Salvador, Bahia State. Goethite-hematite rich breccias with boxwork textures after sulfides are hosted by meta-siltstones of the Mesoproterozic Caboclo Formation. The breccias display anomalous values for zinc and copper. The analytical results of 24 grab samples returned seven values ranging from 1010 ppm and 1775 ppm zinc. Values of up to 833 ppm copper have been obtained as well.

The high zinc content in the breccias associated with the layers of fresh pyrite strongly suggest that the breccias are the product of oxidation and weathering of zinc-rich (and possibly copper) sulfide horizons. The prospectable trend in the southern limb of the Alegre Hill anticlinorium is at least 25 km in length. The northern flank also contains the same breccias zones and merits to be investigated in the field.

Special Committee

Given that the CEO (Cristiano Veloso) and two of the directors of Amazon (Simon Lawrence and Kevin van Niekerk) are also directors of Toucan, are each shareholders of Amazon and hold collectively approximately 19% of the shares of Toucan, a special committee consisting solely of the independent directors of Amazon (Richard Topham and Dr. Getulio Lamartine de Paula Fonseca) was formed by the board of directors at the beginning of the process to consider, conduct appropriate due diligence and negotiate terms of the Transaction. The special committee unanimously approved the Transaction at a Board of Directors meeting held on March 27, 2009.

Closing of the Transaction is subject to approval of the TSX Venture Exchange, and the approval of the shareholders of Toucan at a meeting scheduled to take place on April 30, 2009.

Independent Director Richard Topham said: "The genesis for this minimally dilutive transaction stems from the common business activities of Toucan and Amazon: the two entities share common country exposure, two Directors and a CEO, yet have separate target property mandates in non-gold/base metals and gold/precious metals respectively and operate separate exploration activities. Through this transaction, Amazon acquires the rights to grass roots, early stage exploration assets of longer term merit, and expands its mandate into all metals and commodities. Synergistic benefits will result from consolidating the combined Brazilian-based operations and properties under one entity, one CEO and one Board of Directors. It is expected that day-to-day corporate operating costs will not increase materially which corresponds with Amazon's stated mandate of cash preservation. The acquired assets and expanded mandate represent strong opportunities for Amazon and provide additional means with which we can enhance future shareholder value during turbulent economic times."

About Amazon

Amazon is listed on the TSX Venture Exchange and is a mineral exploration company is engaged in creating shareholder value via cost effectively advancing the Cerrado Verde Potash project and the Madeira Gold project while diligently assessing additional value-adding opportunities. Given the current and foreseeable uncertain economic climate, Amazon is preserving cash and adopting a highly conservative and risk mitigating approach to opportunity assessment and project development.

Competent Person

As required by Canadian National Instrument 43-101, Amazon's designated qualified person required for review of the technical and scientific information herein contained is Dr. Joao Batista G. Teixeira, Chief Geoscientist of the Company.

Cristiano Veloso, President & Chief Executive Officer

Cautionary Language and Forward Looking Statements

THIS PRESS RELEASE CONTAINS CERTAIN "FORWARD LOOKING STATEMENTS", WHICH INCLUDE BUT IS NOT LIMITED TO, STATEMENTS WITH RESPECT TO THE FUTURE FINANCIAL OR OPERATING PERFORMANCE OF THE COMPANY, ITS SUBSIDIARIES AND ITS PROJECTS, STATEMENTS REGARDING USE OF PROCEEDS, EXPLORATION PROSPECTS, IDENTIFICATION OF MINERAL RESERVES, COSTS OF AND CAPITAL FOR EXPLORATION PROJECTS, EXPLORATION EXPENDITURES, TIMING OF FUTURE EXPLORATION AND PERMITTING, REQUIREMENTS FOR ADDITIONAL CAPITAL, GOVERNMENT REGULATIONS OF MINING OPERATIONS, ENVIRONMENTAL RISKS, RECLAMATION EXPENSES, TITLE DISPUTES OR CLAIMS, AND LIMITATIONS OF INSURANCE COVERAGE. FORWARD LOOKING STATEMENTS CAN GENERALLY BE IDENTIFIED BY THE USE OF WORDS SUCH AS "PLANS", "EXPECTS", OR "DOES NOT EXPECT" OR "IS EXPECTED", "ANTICIPATES" OR "DOES NOT ANTICIPATE", OR "BELIEVES", "INTENDS", "FORECASTS", "BUDGET", "SCHEDULED", "ESTIMATES" OR VARIATIONS OF SUCH WORDS OR PHRASES OR STATE THAT CERTAIN ACTIONS, EVENT, OR RESULTS "MAY", "COULD", "WOULD", "MIGHT", OR "WILL BE TAKEN", "OCCUR" OR "BE ACHIEVED". FORWARD LOOKING STATEMENTS INVOLVE KNOWN AND UNKNOWN RISKS, UNCERTAINTIES AND OTHER FACTORS WHICH MAY CAUSE THE ACTUAL RESULTS, PERFORMANCE OR ACHIEVEMENTS OF THE COMPANY TO BE MATERIALLY DIFFERENT FROM ANY FUTURE RESULTS, PERFORMANCE OR ACHIEVEMENTS EXPRESSED OR IMPLIED BY SAID STATEMENTS. THERE CAN BE NO ASSURANCES THAT FORWARD-LOOKING STATEMENTS WILL PROVE TO BE ACCURATE, AS ACTUAL RESULTS AND FUTURE EVENTS COULD DIFFER MATERIALLY FROM THOSE ANTICIPATED IN SAID STATEMENTS. ACCORDINGLY, READERS SHOULD NOT PLACE UNDUE RELIANCE ON FORWARD-LOOKING STATEMENTS.

The potential grades detailed in this release are conceptual in nature. There has been insufficient exploration to define a mineral resource and it is uncertain if further exploration will result in the targets being delineated as a mineral resource.

Readers are cautioned not to rely solely on the summary of such information contained in this release and are directed to the complete set of drill results posted on Amazon's website (www.amazonplc.com) and filed on SEDAR (www.sedar.com) and any future amendments to such. Readers are also directed to the cautionary notices and disclaimers contained herein.

The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release and the information contained herein.

Contact Information

  • Amazon Mining Holding Plc
    Cristiano Veloso
    President & Chief Executive Officer
    +44 (0) 20 8133 7607
    +44(0)20 7405 7773 (FAX)
    Email: cv@amazonplc.com

    Amazon Mining Holding Plc
    Jed Richardson
    VP Corporate Development
    (416) 866-2966
    (416) 866-8829 (FAX)
    Email: jed@amazonplc.com
    Website: www.amazonplc.com