Canada-based Reliance Resources to acquire American Iron

Toronto-based Reliance Resources Limited has announced that it has entered into an agreement to acquire Minnesota-based company American Iron Corp., an iron ore-focused exploration and development company, seeking to acquire projects having potential for low pre-development capital expenditure and significant exploration potential in the United States.
 
American Iron has agreed to cause its shareholders to sell all of their shares of American Iron to Reliance. In return, Reliance has agreed to acquire the American Iron Shares by issuing a total of 10 million Reliance common shares.
 
The transaction is expected to be closed on April 30. Immediately upon closing of the transaction, American Iron shareholders will hold 6 million Reliance shares representing approximately 19.7 percent of the issued Reliance shares. Additionally, American Iron shareholders may increase their shareholdings in Reliance to up to approximately 29 percent of the total issued and outstanding Reliance shares.