Canaco Resources Inc. Announces A$101 Million TreaCanaco Resources Inc. Announces A$101 Million Treasury Bought Deal Financing and $32.4 Million Secondary Bought Deal Financing9 minutes ago - ACQUIREMEDIA
NOT FOR DISTRIBUTION TO UNITED STATES NEWS WIRE SERVICES OR FOR RELEASE, PUBLICATION, DISTRIBUTION OR DISSEMINATION, DIRECTLY ORINDIRECTLY, IN WHOLE OR IN PART, IN OR INTO THE UNITED STATES
VANCOUVER, Feb. 24 /CNW/ - Canaco Resources Inc. (TSXV: CAN) ("Canaco" or the "Company") is pleased to announce it has entered into an agreement with a syndicateof underwriters co-led by Canaccord Genuity Corp. and TD SecuritiesInc. (the "Underwriters"), pursuant to which the Underwriters haveagreed to purchase, on a bought deal basis, 18,700,000 common shares(the "Common Shares") of the Company at a price of $5.40 per share foraggregate gross proceeds to the Company of $100,980,000 (the "TreasuryOffering"). The Company has also agreed to grant the Underwriters anover-allotment option, exercisable for a period of up to 30 daysfollowing the closing of the Treasury Offering, to purchase from theCompany up to an additional 2,805,000 Common Shares at a price of $5.40per share for additional gross proceeds of up to $15,147,000 (the"Over-Allotment Option"). If the Over-Allotment Option is exercised inits entirety, the aggregate gross proceeds of the Treasury Offering tothe Company will be $116,127,000.
In addition to the Treasury Offering, the Underwriters have agreed topurchase, on a bought deal basis, from SinoTech (Hong Kong) CorporationLimited ("SinoTech"), 6,000,000 Common Shares at the same price as theTreasury Offering for gross proceeds to SinoTech of $32,400,000 (the"Secondary Offering"). The Company will not receive any proceeds fromthe Secondary Offering.
SinoTech currently holds 48,000,000 Common Shares, representingapproximately 28% of the Company on an undiluted basis. After givingeffect to the Treasury Offering and the Secondary Offering, but beforegiving effect to the Over-Allotment Option, SinoTech will hold42,000,000 Common Shares, representing approximately 22% of the Companyon an undiluted basis.
In connection with the Treasury Offering and the Secondary Offering, theUnderwriters will receive a cash commission equal to 5.5% of the grossproceeds raised pursuant to the Treasury Offering (including uponexercise of the Over-Allotment Option) and the Secondary Offering. Inconnection with the Treasury Offering, the Underwriters will alsoreceive broker warrants (the "Broker Warrants") equal to 3.0% of theaggregate number of Common Shares sold pursuant to the TreasuryOffering (including upon exercise of the Over-Allotment Option). EachBroker Warrant shall be exercisable to purchase one Common Share at aprice of $6.00 at any time up to 24 months after closing of theTreasury Offering.
Net proceeds from the Treasury Offering are expected to be used byCanaco to fund ongoing development and exploration activities on theCompany's African mineral properties and for general corporate andworking capital purposes.
The Common Shares to be issued pursuant to the Treasury Offering, andthe Common Shares to be sold pursuant to the Secondary Offering, willbe offered by way of a short form prospectus in the provinces ofBritish Columbia, Alberta, Saskatchewan, Manitoba and Ontario.
Closing of the Treasury Offering and the Secondary Offering is scheduledto occur on or about March 22, 2011 and is subject to certainconditions including, but not limited to, the receipt of all necessaryregulatory and other approvals including the approval of the TSXVenture Exchange and the securities regulatory authorities.
The securities offered have not been, and will not be, registered underthe U.S. Securities Act of 1933, as amended (the "U.S. Securities Act")or any U.S. state securities laws, and may not be offered or sold inthe United States or to, or for the account or benefit of, UnitedStates persons absent registration or any applicable exemption from theregistration requirements of the U.S. Securities Act and applicableU.S. state securities laws. This news release shall not constitute anoffer to sell or the solicitation of an offer to buy securities in theUnited States, nor shall there be any sale of these securities in anyjurisdiction in which such offer, solicitation or sale would beunlawful.
About Canaco
Canaco is a Vancouver-based mineral exploration company focused onadvanced exploration in Africa. Built on a foundation of experiencedmanagement and focused on rapidly advancing exploration projects inTanzania and throughout Africa, Canaco believes it is well positionedto build shareholder value through discovery and resource development.
Canaco's shares trade on the TSX Venture Exchange under the symbol CAN.
On behalf of the Board of Directors,
Andrew Lee Smith, P.Geo
President, CEO and Director
Cautionary Statement Regarding Forward-Looking Information
This news release contains "forward-looking information" within themeaning of applicable Canadian securities legislation. Generally,forward-looking information can be identified by the use offorward-looking terminology such as "anticipate", "believe", "plan","expect", "intend", "estimate", "forecast", "project", "budget","schedule", "may", "will", "could", "might", "should" or variations ofsuch words or similar words or expressions. Forward-looking informationis based on reasonable assumptions that have been made by the Companyas at the date of such information and is subject to known and unknownrisks, uncertainties and other factors that may cause the actualresults, level of activity, performance or achievements of the Companyto be materially different from those expressed or implied by suchforward-looking information, including but not limited to: risksassociated with mineral exploration and development; metal and mineralprices; availability of capital; accuracy of the Company's projectionsand estimates; interest and exchange rates; competition; stock pricefluctuations; availability of drilling equipment and access; actualresults of current exploration activities; government regulation;political or economic developments; environmental risks; insurancerisks; capital expenditures; operating or technical difficulties inconnection with development activities; personnel relations; thespeculative nature of strategic metal exploration and developmentincluding the risks of diminishing quantities of grades of reserves;contests over title to properties; and changes in project parameters asplans continue to be refined. Forward-looking statements are based onassumptions management believes to be reasonable, including but notlimited to the price of gold; the demand for gold; the ability to carryon exploration and development activities; the timely receipt of anyrequired approvals; the ability to obtain qualified personnel,equipment and services in a timely and cost-efficient manner; theability to operate in a safe, efficient and effective manner; and theregulatory framework regarding environmental matters, and such otherassumptions and factors as set out herein. Although the Company hasattempted to identify important factors that could cause actual resultsto differ materially from those contained in forward-lookinginformation, there may be other factors that cause results not to be asanticipated, estimated or intended. There can be no assurance that suchinformation will prove to be accurate, as actual results and futureevents could differ materially from those anticipated in suchinformation. Accordingly, readers should not place undue reliance onforward-looking information. The forward-looking information containedin this news release is included for the purpose of providing investorswith information to assist them in understanding the Treasury Offeringand the Secondary Offering and may not be appropriate for otherpurposes. The Company does not undertake to update any forward-lookinginformation that is included herein, except in accordance withapplicable securities laws.