Dynamite acquiring Kyrgyz uranium properties

A takeover bid for a privately-held British company would give Dynamite Resources (DNR-V) a pair of uranium projects in Kyrgyzstan.

Dynamite is offering a share trade of one Dynamite share and one warrant (exercisable for two years at $1) for four shares of Tau Mining, which holds the Kokomeren and Barskaun mineral licences in eastern Kyrgyzstan. A cash alternative offers $2.40 plus one Dynamite share for 16 Tau shares.

The transaction, which values Tau at $36.6 million, is conditional on attracting at least 70 million of the 183 million outstanding shares of Tau. Dynamite says it expects to see about 90 million shares tendered to the cash-and-share offer, which would require about $13.5 million in cash.

Tau’s manging director, David Argyle, would join the Dynamite board.

Dynamite has arranged a private placement financing to raise between $20 million and $30 million, with 25 million subscription receipts to be issued at 80, plus an underwriter’s option for 12.5 million more receipts. A receipt would be exchangeable on the closing of the Tau transaction for one share and one warrant exercisable at 80.

Assuming subscriptions for 37.5 million shares, Dynamite would spend $13.5 million on the Tau acquisition and $10 million on exploration, half on the Tau properties and half on the properties it currently holds. Another $4.7 million would go into working capital and general expenses, and a 6% commission would go to the brokers.

Kokomeren, about 90 km south of the Kyrgyz capital Bishkek, is 939 sq. km in size and hosts the Orto-Kuganda uranium deposit, which Soviet-era operators estimated to hold 92,000 tonnes grading 0.15% U₃O₈. The deposit, which is hosted in an intrusion, sits on a structure several kilometres long with a number of showings along it.

Barskaun, south of Lake Issyk-Kul about 250 km southeast of Bishkek, is a property of 311 sq. km that has no calculated resources. There are about 20 uranium showings on the property.