NEW YORK, June 24 /PRNewswire-FirstCall/ -- Volcan
Holdings, Inc. (OTC Bulletin Board: VOHO) (the "Company" or
"Volcan") - has reached an agreement to acquire a controlling stake
in Australian Gold Investments Limited (AGV), a diversified
minerals exploration company listed on the Australian Securities
Exchange (ASX). Specifically, Volcan has agreed to transfer 80% of
3 of its North Queensland bauxite
projects into AGV, in return for an issue to Volcan of shares of
AGV that will represent approximately 43% of AGV, plus an
equivalent number of options.
The agreement is binding subject to AGV shareholder
approval.
The projects are the 5 tenements that comprise the South
Johnstone, Ravenshoe and Atherton projects held by Volcan in
North Queensland; exploration
Licenses EPM18138, EPM18139, EPM18140, EPM18463 and EPM18464.
Following the transfer of Volcan's interest in these projects to
AGV, Volcan will continue to retain a 100% interest in the 26 other
bauxite tenements that it owns throughout eastern Australia. For further information on Volcan's
projects, please visit www.volcanholdings.com
Highlights:
- Volcan will own a significant controlling holding in an ASX
listed company (AGV).
- AGV is holding gold exploration projects in Australia, including in the renowned for
gold-mining Kalgoorlie district of Western Australia, the Pilbara region of
Western Australia, and in northern
NSW.
- AGV is holding a sapphire mine with a JORC indicated resource
of approximately 25M carats including a processing plant and mining
and exploration equipment.
- Following the acquisition, Volcan, through its share holdings
in AGV, will retain control over the North Queensland projects and, including its
retained 20% interest, Volcan will still have an effective
beneficial interest of approximately 60% of the 3 North Queensland projects, with additional
options in AGV to significantly further increase its
ownership.
- The directors of Volcan believe that this acquisition and
positive exposure to other diversified mineral assets has the
potential to add significant value to Volcan.
- The directors also believe that this transaction, with its
increased exposure to the local Australian capital markets, has the
potential to encourage institutional and general Australian
investment into all of Volcan's bauxite projects.
Acquisition Process:
The transfer of the interests of the tenements from Volcan into
AGV will be in return for AGV issuing to Volcan 65 million AGV
shares and 65 million 5 year options exercisable at 5 cents, together with a royalty to Volcan of
$1 per ton on production from the
tenements.
AGV will require shareholder approval to complete the
acquisition as there are common directors across the AGV and Volcan
boards and two of the common directors hold controlling interests
in both companies.
The process for AGV shareholder approval is anticipated to take
approximately 2-3 months.
Commentary:
Pnina Feldman, Volcan's
chairperson said: "It is opportune that a synergy can be created
between these two companies, especially as AGV has diversified
Australian mineral assets, is listed with ready access to the
Australian public and institutional markets, and Volcan's assets
are all Australian based. This synergy should bring much success to
both companies and should enable the fast tracking of the
development of Volcan's vast bauxite project holdings."
For further information on Volcan Holdings please visit
www.volcanholdings.com, or email Sholom
Feldman, Volcan's Managing Director at
sfeldman@volcanholdings.com or call Dan
Myers on +1-516-849-9119.
Safe Harbor Statement:
This press release contains certain forward-looking statements.
Such statements may be preceded by the words "intends,"
"may," "will," "plans," "expects," "anticipates," "projects,"
"predicts," "estimates," "aims," "believes," "hopes," "potential"
or similar words. Forward-looking statements are not guarantees of
future performance, are based on certain assumptions and are
subject to various known and unknown risks and uncertainties, many
of which are beyond the Company's control, and cannot be predicted
or quantified and consequently, actual results may differ
materially from those expressed or implied by such forward-looking
statements. Such risks and uncertainties include, without
limitation, those risks and uncertainties set forth in the
company's filings with the Securities and Exchange Commission,
including the Company's Annual Report on Form 10-K/A filed with the
SEC on January 15, 2010. Investors
and security holders are urged to read this document free of charge
on the SEC's web site at www.sec.gov. The Company does not
undertake to publicly update or revise its forward-looking
statements as a result of new information, future events or
otherwise.
SOURCE Volcan Holdings, Inc.
