Vancouver – In a combination of grand metal adjectives, Mega Uranium (MGA-T, MGAFF-O) is moving to acquire Monster Copper (MNS-V, MCPRF-O) through a takeover agreement.
Terms of the proposed amalgamation under a binding letter of agreement will see Monster shareholders receive one Mega Uranium share and one-half a warrant for every six common shares held. Each full Mega Uranium warrant will be exercisable at $7.00 apiece for 5 years.
The prize for Mega is Monster Coppers portfolio of prospective iron-oxide copper-gold (IOCG) projects in Labradors Central Mineral Belt, north-central Brazil and in the Yukon.
Monsters Mustang Lake project in Labrador, a joint venture with Santoy Resources (SAN-V, SANRF-O), is situated within Aurora Energy Resources‘ (AXU-T, AUEGF-O) land package about midway between the advanced explorers Michelin and Jacques Lake uranium deposits.
Its Brazilian project package was optioned from Noranda, now part of Xstrata (XSRAF-O, XTA-L), in late-2004 with Monster acquiring 60% interest in ten separate IOCG prospective properties totaling about 800 sq. km. in Carajs Mineral Province. The area also holds decent nickel laterite potential.
Megas acquisition will boost its footprint in a number of significant IOCG camps with a specific focus on uranium mineralization.
Based on Megas 10-day volume weighted average trading price ending March 7th, the deal values Monster at $1.09 per share plus the half-warrant. Up to 7.9-million Mega shares could be issued under the planned transaction in addition to 3.95-million warrants.
Over the past couple of years Mega has grown itself into a significant uranium explorer through a series of corporate acquisitions. The companys Australian holdings host a combined resource of more than 47 million contained lbs. of U3O8. It also has uranium exploration projects in Argentina, Mongolia, Bolivia and Canada.
Shares of Monster Copper rallied 42% on the March 8 news, closing up 32 at $1.09 apiece on trading volume of more than 4.3 million. Based on its 33.5-million shares outstanding, the targeted junior posts a $36-million market capitalization and has a 52-week trading range of 26-to-$1.20.
Mega Uranium slipped almost 4% following the announcement closing off 22 at $5.90 per share. It has an $845-million market capitalization based on 143.2-million shares outstanding. The stock has a trading range of $2.29-to-$7.49 over the past year.
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