SXR Uranium One (SXR-T, SXR-J) has offered to take over UrAsia Energy (UUU-T, UUU-L) to create a $5-billion uranium company that would have early production from Australia and South Africa, and advanced projects in Central Asia.
SXR’s bid is 0.45 of a share for each share of UrAsia, with the successor company to be called Uranium One. The imputed value based on closing prices of the two companies is $7.05 per share, a 13% premium over UrAsia’s market value. UrAsia shareholders will have about 40% of the shares in the new company, and three of the nine directors on the board.
UrAsia has a 70% interest in the Akdala and South Inkai uranium projects in southern Kazakhstan, and a 30% interest in another Kazakh project, Kharassan. Akdala is currently in production as an in-situ-leach mine, in joint venture with the Kazakh state uranium producer, Kazatomprom; it sold 1.3 million lb. U3O8 in the twelve months ended Oct. 31/06.
Both South Inkai and Kharassan are currently in development as in-situ-leach mines, and are expected to go into production late this year. South Inkai is slated to produce 1.6 million lb. and Kharassan 1.9 million lb. U3O8 annually once they are in production.
SXR’s Honeymoon uranium project in South Australia is scheduled to go into production in early 2008, at about 880,000 lb. annually. A feasibility study on its Dominion project in South Africa suggested production of 3.8 million lb. annually.
Both companies have sales contracts for anticipated production in hand, mainly at market prices.
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