Allana Resources Updates Announcement of Potash Resource Acquisition
Allana Resources Inc., update its previously announced acquisition of three mineral concessions in Ethiopia’s northeastern Danakil Depression totaling approximately 150 square kilometers (please refer to Allana’s September 17, 2008 press release). The project area is approximately 100 km from the Red Sea coast and 600 km via good roads from the deep water port of Djibouti. Mining for potash has been carried out in the Danakil Depression intermittently from the early 1900s. Mining companies currently working in the basin include BHP Billiton and Sainik Coal Mining (Sainik), a leading Indian-based coal mining company, the latter of which is planning to initiate mining at the Musley deposit.
Allana has agreed to acquire the properties from three private companies, Forbes & Manhattan, Inc., SB Management and Ethio-Gibe Canada Mining PLC in consideration for an aggregate of $2.5 million in cash payments over 3 years and the issuance of 4 million shares. The property will also be subject to a 3% NSR of which 50% can be purchased for CDN $ 5,000,000. Both Forbes & Manhattan, Inc. and SB Management are non-arms-length parties to the transaction as a result of Stan Bharti, an insider of each, being a 10% shareholder of Allana. Accordingly, completion of the acquisition is subject to the receipt of approval of the TSX Venture Exchange.
Allana is a publicly traded corporation with a focus on the acquisition and development of potash assets internationally and recently completed the acquisition of Latin American Potash in Argentina. Allana has approximately 45 million shares outstanding and trades on the TSX-Venture Exchange under the symbol “AAA”.