 TORONTO (miningweekly.com) – With shareholder approval now in the bag, Uranium One expects to close the sale of a controlling interest in itself to Russian government-owned uranium-miner Atomredmetzoloto (ARMZ) by the end of this year.
The company only needed the approval of a majority of minority shareholders for the deal, and the results of Tuesday's vote easily passed the threshold level, with around 91,99% of the votes cast by shareholders other than ARMZ voting in favour.
The deal involves ARMZ increasing its holding from 23% to 51% of Uranium One in exchange for holdings in two Kazakh uranium mines and $610-million in cash.
Tuesday's strong endorsement from shareholders was far from a sure thing just three months ago, when the two companies first announced the agreement.
Shares in Uranium One, which traded at C$2,62 a share the day before the deal was announced, dropped as low as C$2,19 in the wake of the news.
“When we think of all the hard work we had to put in, to have such a massive vote of confidence, we really are very happy,” CEO Jean Nortier commented on the vote result.
The company's stock has more than regained its losses since the initial drop though, and was trading at C$3,51 a share on Wednesday afternoon.
One of the main difficulties shareholders had at the beginning was the complexity of the transaction, he said on Wednesday.
The company plans to use the cash from ARMZ to pay a special dividend of $1,06 a share to minorities, which it is calling a 'change of control premium'.
“Giving control away, and then having the dividend come through as a change of control premium was something that has not been done before," he commented in an interview.
“So there was complexity associated with the transaction that was not properly understood at the beginning."
There was also a bit of consternation around how the goals of a Russian State corporation would line up with the interests of minority shareholders.
“But I think as we've gone around and we've shown our shareholders that, indeed, the goals can be aligned, they certainly came around.”
ARMZ, which is part of Russian nuclear group Rosatom, has said it plans to use Uranium One as a vehicle for international growth, but officials have assured investors that it wants to see the firm's market value increase too.
There are still some regulatory approvals before the deal can close, including from the Kazakh Anti-Monopoly Commission, the Australian Foreign Investment Review Board and the US Committee on Foreign Investment.
The firm announced on August 30 that the Kazakh Ministry of Industry and New Technologies (MINT) had formally approved its acquisition of ARMZ's stakes in the Akbastau and Zarechnoye mines.
The MINT also approved Uranium One's plans to issue the shares underlying its C$260-million convertible debentures issued in March this year
Uranium One expects to produce seven-million pounds of uranium this year, Nortier said earlier this month.
Besides the 50% in Karatau, Uranium One owns 70% of the Akdala and South Inkai mines in Kazakhstan, as well as 30% of the Kharasan mine, also in Kazakhstan. The company also has assets in the US, where it plans to start production next year, as well as in Australia.
Under the deal approved on Tuesday, Uranium One will buy ARMZ's 50% interest in the Akbastau uranium mine and its 49,67% interest in the Zarechnoye uranium mine.
|
|
