Kalahari Minerals Share Discussion Threads

[kimball808] 11/8/2011 15:25

Thx Beefy...House broker not mincing his words...

[beefeater25] 11/8/2011 14:34

Kalahari Minerals: bid for uranium firm back on soon

2:22 pm by Jon Mainwaring

In May, CGNPC wanted to reduce its bid for Kalahari to 270 pence to reflect the drop in global uranium equities after the Fukushima incident The takeover bid for Namibia-focused uranium firm Kalahari Minerals (LON:KAH) will soon be back on, according to Ambrian Partners analyst Duncan Hughes, now that three months have elapsed since the UK Takeover Panel forbade Chinese firm CGNPC-URC from reducing its 290 pence per share offer for Kalahari to 270 pence per share.

On May 10 the Takeover Panel ruled that China Guangdong Nuclear Power Group – Uranium Resources Co. would not be permitted to announce an offer for Kalahari for a price of less than 290 pence per share for three months. At the time, Proactive Investors reported that Rio Tinto, which owns the neighbouring Rossing uranium mine, could also be a rival suitor for Kalahari.

Ambrian's Hughes now believes that an offer of 270 pence per share could be imminent. "I think that something will have to happen here," he told Proactive Investors. "If not CGNPC, then it will be Rio."

An important signal for a renewed takeover attempt could be CGNPC's announcement this week that it is issuing around £283 million in short-term bonds, with a maturity of 366 days, on the interbank market, although it said that the proceeds will be used to "replenish the firm's working capital and repay loans".

270 pence per share is the likely offer since that was the price that, effectively, had been agreed previously, added Hughes.

A key reason why the Chinese firm wanted to revise its original price, which valued Kalahari at £756 million, was because of the meltdown in global uranium equities in the wake of the Fukushima nuclear disaster that followed Japan's massive earthquake and tsunami in March.

Kalahari has a major stake in the Husab Uranium Project in Namibia via its 42.8 per cent stake in Extract Resources (ASX:EXT, TSE:EXT). Rio's nearby Rossing uranium mine has produced more than 260 million pounds of uranium since 1976.

Yesterday, Extract reported a 37 per cent increase in reserves, and a 42 per cent increase in contain uranium, at Husab. The firm's executive chairman commented that "the scale and economics of the Husab Uranium Project continue to underpin the fantastic potential for the development of the world's largest and most significant long life uranium mines".

Ambrian, Kalahari's house broker, noted the 37 per cent increase in reserves that extends the mine life for Zones 1 and 2 to more than 20 years and the increase in ore grade from 497 parts per million to 518ppm, as well as a maiden declaration of proven reserves equivalent to four years of full production.

The broker commented: "These exceptional results continue to emphasise that the Husab Uranium Project is a world-class mineral asset. The project now has over 20 years of mine life defined. We are confident that the project will continue to grow, and point out that the reserve is just from Zones 1 and 2 at Husab."

By 2pm today, shares in Kalahari were up 2.9 per cent at 224.25 pence each.

[krakow] 11/8/2011 09:42

..or more likely they really are tight and already knew about the upgrade and priced it in. Myself, I reckon there's closer to 500Mlbs here.

[zangdook] 11/8/2011 07:39

A new offer for Kalahari may be about 250 pence a share

Old offer: 270p

Resource upgrade: 37%

270p x 137% = 369.9p

Perhaps the Chinese use different maths.

[kimball808] 11/8/2011 07:11

Lots of news flow of the likes below now coming across:

[gero67] 10/8/2011 15:59

Extract ups uranium deposit reserves

The Australian Financial Review
PUBLISHED: 11 Aug 2011 PRINT EDITION: 11 Aug 2011
Angela Macdonald-Smith

Extract Resources has reported a substantial increase in reserves at its huge Husab uranium deposit in Namibia, just as China Guangdong Nuclear Power is expected to renew its bid to gain a dominant stake in the project.

The Chinese nuclear giant abandoned a $1.1 billion tilt at Kalahari Minerals, which owns 42.8 per cent of Extract, back in May after a UK regulator prevented it from dropping its proposed offer price after the Japanese nuclear crisis.

But China Guangdong is understood to still be keen to elbow into the Husab venture and is permitted to return with a new offer as of today, three months after the Takeovers Panel ruling.

Under Australian takeover regulations, any bid for Kalahari would normally have to be followed up with an offer on at least equivalent terms for Extract.

On Tuesday the Chinese state firm advised it will issue 3 billion yuan ($450 million) in short-term bills to bolster working capital and repay loans, reinforcing expectations it is set to move again on Kalahari.

"We maintain that a fresh offer is highly probable after a three-month cooling-off period," said Merrill Lynch analyst Glen Chipman.

Merrill has a $9.50 price target for Extract, 32 per cent above yesterday's closing price of $7.20.

It calculates that even if China Guangdong cuts its offer price further and comes back with a 250 pence per share bid, the see-through value for Extract would still be about $9.50 per share. The Chinese firm had originally planned to bid 290 pence per share, so such a reduction would be roughly in line with the 12 per cent cut in the bid price successfully negotiated in March by Russian nuclear player ARMZ for Mantra Resources, which also owns a uranium deposit in Africa.

Husab is set to be one of the world's biggest suppliers of uranium once it comes into production in 2014. Chinese firms are scouring the world for such deposits to meet the nation's aggressive nuclear build program.

Extract has been in talks with Rio Tinto, its second-biggest shareholder, about a joint development of Husab with Rio's adjacent Rossing mine.

Extract yesterday said estimated reserves at Husab have increased 37 per cent to 280 million tonnes of ore, extending the expected life of the mine to over 20 years. Total contained uranium is now put at 319.9 million pounds of uranium oxide, up from 224.8 million pounds in April.

[zangdook] 10/8/2011 12:25

"The board of Kalahari see that Husab represents the most significant new
uranium mine coming into production..."

Should that read "now see"? Or do they mean, we see it's really good but we still want to sell it for peanuts.

[sparty1] 10/8/2011 12:16

over on NRRP Mr 500K buyer @ 2p seems to pop up regularly.Someone is accumulating big lumps .
Dont see any grounds for pessimism really.Do we really think KAH will allow much more dilution in NRRP? If they Get the cash from sth rossing will they ignore a perfect vehicle that they own ...to push on with other projects? OK you can say there is a risk but as someone who lost a fortune favouring the "safe" banks I dont think so. Anywhere around this buying price for KAH or NRRP is an opportunity imo. This is the date another bid can be tabled for EXT / KAH ? So what will RIO do? sit on its hands and let a company with a world class resourceget away? A company they have a big stake in already and who happen to be next door... Good luck you KAH holders ,you will do fine.The chinese nuclear programmes will ensure that IMO .I am not in here but am buying big chunks of NRRP! Not as much as mr 500K buyer but big enough! LOL

[verymaryhinge] 10/8/2011 11:39

yes, in any other market.. Wooosh!

[beefeater25] 10/8/2011 09:24

Correct me if Im wrong but isnt that a magnificent result???
37% increase in reserves?

[beefeater25] 10/8/2011 08:50

Any news on the announcement in Oz last night?

[kimball808] 10/8/2011 07:21

A very chunky late trade yesterday...

[red ninja] 09/8/2011 21:08

The market never travels in one direction ...

[beefeater25] 09/8/2011 18:03

I've got a feeling tomorrow is going to be a good day here... hope im right!

[beefeater25] 09/8/2011 09:18

They are abviously going to want to pay the lowest they can for it but will be aware that any silly offers will not get accepted. If they come back and offer less than 270p Ill be rejecting the offer.

[zangdook] 09/8/2011 08:54

Yes, but if they can find a way to take advantage of the stupid Western financial system they will do. ISTM the post-Fukushima reduction from 290p to 270p was pure opportunism.

I don't think they could come down anywhere near the current share price though so imho there's still a good opportunity for anyone with cash. I suspect there may be hard talking going on in the background now.

Unfortunately I've had to use most of my warchest deleveraging my spreadbet account. Otherwise I'd be buying.

[beefeater25] 09/8/2011 08:29

The Chinese still need uranium. A correction in the market doesnt change that. If they want this (which i personally think they do) then they will be back tomorrow.

[kimball808] 09/8/2011 07:01

Surely the waiver of the $7.5m was a contract in it's self to come back later with an agreed price... depends if the Chinese will decide otherwise...

[zangdook] 09/8/2011 06:30

I don't think an offer depends only on the share price. The BoD must have a lower limit.

[stu31] 08/8/2011 17:19

why do they want to push up the price before a bid..if they're not stupid they will be shorting this so they can put in a lower offer..

[zangdook] 08/8/2011 17:11

If they're not stupid they'll be hoovering them up in the market and only bid when they've got 29% cheap. (Or as much as they can.)

[red ninja] 08/8/2011 16:52

There's been plenty of time for an offer to emerge when the Chinese could not bid so I'm assuming they are the only pony in town, albeit a pony which will probably partner Rio in the fullness of time. We'll see as event unfold....

How soon they would like Husab to come on line will dicate how long they take to make a bid..

[zangdook] 08/8/2011 16:44

the Chinese said they would be back in something like 3 - 6 months

They seem pretty confident no-one else is going to make an offer. So far, they've been right.