PERTH (miningweekly.com) – ASX-listed Cauldron Energy’s takeover offer for fellow-listed Energia Minerals has hit another snag, after the takeover target’s new substantial shareholder said it would not accept the offer.

Energia said on Monday that it had received confirmation from shareholders Charles Arve and his associated entities that they would not accept the Cauldron offer.

This meant that shareholders owning some 53.34% of the issued share capital of Energia would reject the Cauldron offer, which would result in the proposed takeover not proceeding.

The directors of uranium explorer Energia, in May, advised shareholders to reject the one-for-eight share offer from Cauldron, after an independent expert found that the offer was neither fair nor reasonable.

Further, Energia also pointed out on Tuesday that Cauldron’s recent converting loan agreement with two of its major shareholders had created uncertainty as to the impact of the agreements on the company’s capital structure and its financial position.

Under the agreement, Cauldron would receive A$1.5-million in cash, which would immediately be converted into ordinary shares in the company.

Energia said that if shareholder approval was obtained for the agreement, it would result in additional dilution for Energia shareholders. If shareholder approval was not obtained, Cauldron would be left with a large short-term debt, which would likely prompt the miner to raise further cash.

To date, Cauldron has received acceptance from shareholders holding only 0.27% of the issued capital of Energia, prompting the miner to extend its closing date for the offer until November 16.

The Carley Bore deposit at Energia’s Nyang project currently had an inferred mineral resource of 16.9-million tons, at 350 parts per million uranium oxide (U₃O₈) for 13-million pounds of U₃O₈.

Cauldron, in turn, recently announced an exploration target of between 30-million and 115-million pounds of U₃O₈ at its wholly owned Yanrey project, in Western Australia, which is adjacent to the Nyang deposit.