Uramin Share Discussion Threads

[papillon] 16/6/2007 11:04

Excellent post SAGEM. The US$75 million break clause payment to Areva in the event that they fail to capture UMN is not a guaranteed payment according to the wording in yesterday's bid statement. Its payment depends on certain conditions which are not detailed. In any event US$75 million is a drop in the ocean compared with the US$2.8 billion that any bidder, offering say 450p per share, would need to pay. I dont think it will deter any other potential bidder.

[simonbroughton] 16/6/2007 10:27

Good article SAGEM.
It's time to start looking for take over candidates. I guess Paladin could be a good starting point.

[sagem] 16/6/2007 09:53

I wonder who will be the counter bidder...BHP Billiton have plenty cash ;-

Areva Offers $2.5 Billion for Uranium Miner UraMin (Update4)

By Stewart Bailey

June 15 (Bloomberg) -- Areva SA, the world's largest manufacturer of nuclear plants, offered to pay more than $2.5 billion in cash for UraMin Inc. to gain uranium-mining assets as global demand for the nuclear fuel rebounds.

Areva agreed to pay $7.75 a share, Johannesburg-based UraMin said today in a statement. That's 4.6 percent more than UraMin's closing price in the U.S. yesterday and 7.6 percent more than on June 11, the day before UraMin first said it was in talks.

The acquisition will give French state-owned Areva mining- exploration projects in Namibia, South Africa and the Central African Republic that have yet to start production. The price of uranium has jumped more than sixfold in three years because of resurgent demand for nuclear power caused by concern about pollution from plants powered by fossil fuels such as coal.

``This is essentially the French government buying major uranium deposits in Africa to ensure its supply of a strategic resource,'' Kevin Bambrough, a strategist at Toronto-based Sprott Asset Management Inc., UraMin's second-largest shareholder, said in a telephone interview. ``This is extremely bullish for the uranium sector.''

Shares of UraMin rose 31 pence, or 8.2 percent, to 408 pence ($8.06) in London, indicating some investors anticipate a better offer. The stock has almost tripled in London this year.

Higher Offer

``Shareholders are going to hold out for a higher offer,'' said John Meyer, a mining analyst at Numis Securities Ltd. in London. ``It's a company with assets on the way to development. This could be attractive for other bidders.''

Possible rival bidders include BHP Billiton Ltd., Anglo American Plc and Rio Tinto Group, the world's three largest mining companies, and Uranium One Inc., which is developing South Africa's largest uranium deposit, Meyer said. Shareholders will probably hold out for about 450 pence, he said.

The French nuclear company has a market value of 27.3 billion euros ($36.5 billion). Its investment certificates dropped 17.94 euros, or 2.3 percent, to 771.06 euros in Paris. The certificates are nonvoting shares that represent about 4 percent of Areva. The government owns the rest.

Break Fee

Areva has an option to match any offer and agreed to a $75 million break fee if UraMin accepts a rival bid. About 20 shareholders, who together hold about 25 percent of UraMin's stock, agreed to accept the bid in the absence of a better one, Olivier Mallet, Areva's senior executive in the mines chemistry department, said today. Areva already owns 5.5 percent of Uramin.

Galahad Gold Plc, which owns 6.4 percent of UraMin on a fully diluted basis, said it plans to hold a shareholders' meeting to gauge support for the bid.

Areva wants to ``secure, on a long-term basis, uranium supply for our customers in a very tight market situation,'' Mallet said on a conference call with analysts. ``It is a friendly offer and, we believe, a very attractive one.''

Before the UraMin bid, Areva planned a doubling of its current production of 13.2 million pounds by 2012. UraMin's deposits will add another 15.4 million pounds once they're developed, Mallet said.

Uranium Prices

Uranium prices will rise through at least 2009 and won't ``stabilize'' until after 2015, Lehman Brothers Holdings Inc. forecast in a June 8 report. Uranium will average $120.06 a pound this year, rising to $167.49 in 2009, the bank said. Prices will probably drop below $70 in 2017. Uranium sold for $6.75 a pound as recently as 2001.

Companies are paying rising premiums to gain uranium assets. Uranium One paid 2.9 times UrAsia Energy's total assets in a $3.25 billion purchase in April, according to data compiled by Bloomberg. Areva is offering 16 times UraMin's 2006 assets.

Areva was formed in 1999 by the merger of two French state- owned companies: nuclear fuel company Cogema and reactor builder Framatome ANP, a combination designed to give it the scale to compete with rivals such as General Electric Co.

The French company's fuel operations include mining, enrichment and production of fuel assemblies, grids of uranium- filled metal tubes that go into nuclear reactors.

Soaring costs for oil, gas and coal, and the suspicion that the carbon dioxide they emit may be contributing to extreme weather, are renewing interest in nuclear power. First Uranium Corp., a developer of uranium mines in South Africa, estimates that annual demand from utilities is outpacing supply by about 70 million pounds (32 million kilograms).

French Plants

The French government is betting big on nuclear. State- owned Electricite de France SA runs 58 nuclear plants that provide 78 percent of the country's electricity.

Along with the projects in Namibia, South Africa and the Central African Republic, UraMin has projects in Chad, Niger, Senegal and Mozambique, according to the company's Web site. It also has a joint-venture project in Canada.

Globally, there are 437 nuclear power plants across 30 countries, with 30 more being built, 74 planned and 182 proposed, according to Lehman Brothers.

To contact the reporter on this story: Danielle Rossingh in London at [e-mail] ; Stewart Bailey in Johannesburg Sbailey7@bloomberg.n

[sagem] 16/6/2007 06:35

They talk as though its all over with no further bid allowed:-

//www.uranium-stocks.net

UraMin Inc: Bid $7.75 from Areva
Print This Post | Email This Page: Topic: Uranium Mining Stocks - June 15th, 2007
According to the TSX UraMin Incorporated have received a bid from Areva to acquire the company for through a cash offer of $7.75 per share.

This offer represents a premium of 21% over UraMin 20-day average share price. The UraMin Board of Directors are fully supportive of the bid and Lock-up agreements in respect of approximately 25% of shares are now in place.

Well it now looks like a done deal so the excitement of a battle with rival suitors is not to be – shame, we have just re-stocked the drinks cabinet.

So where does that leave us? Just to recap we bought into UraMin on the 15th May 2007 for $6.72 so we have a profit of $1.03 or a gain of 15% in 4 weeks.

As one of our readers has just pointed out we are not here to fall in love with any particular stock we are here to make money and 15% in 1 month will have to do. However, this does look like a scoop for Areva as we thought UraMin was worth a lot more.

[bobic] 15/6/2007 23:05

In Canada finished at +.91 @ 8.85 c$ on a very big 25M volume.This
only sugest another bid on its way.Regards best of Luck.

[cagr] 15/6/2007 22:52

Its not over yet, the Chinese State fund is yet to bid. Things are about to get interesting....

[sagem] 15/6/2007 22:36

I like this part of the bid notification ;-

Areva has the right to match any competing offers, and the agreement includes a US$75-million break fee if another bid prevails. The deal is subject to regulatory approval.
///////////////////////////////////////////////////////////////////////////

W ell we now wait for China or some other company to up the bid price and commence a bidding war to our advantage. £5.00 is fair value and I am sure this is what URAMIN is expecting to achieve. The Weekend Papers will I think have a lot to say and will suggest certain companies. Nex tweek will be very interesting.

[papillon] 15/6/2007 20:38

Martin I wonder if TSE:FSY will go the same way as UMN? After its big drop it begins to look rather attractively priced. Could be one to invest in. Production starts in 2009. I like the look of BRM. Price might drop back a bit more but they are currently drilling. Got cash. Already got U reserves. Very near to UMN site in SA. I have around 200k shares in URA but obviously very speculative. As SCR found out with their Molybdenum prospect in China good samples from surface and trenches didn't mean a commercial prospect when they drilled. ASX/TSE:PDN has got good reserves in both Namibia and Malawi. Its already a producer. Its the safest one but also has excellent prospects. Price has come back in the last month so is now attractively priced again. I'm still holding on to my UMN. The bid acts as support and I believe there is still potential for a higher bid. As I said in an earlier post I thought UMN was worth at least £5 now but feared the Directors wanted to cash in so might accept a lower bid; which they did. I was critised at the time, by some, for saying that. But it unfortunately turned out to be correct. Bought UMN heavily at the start of the week so now have around 38k shares.

[papillon] 15/6/2007 20:17

According to the bid statement the Directors and certain other shareholder(s) are locked into Areva's bid BUT IF UMN recommend another offer then Areva have the opportunity to match it. Seems like both the Directors and Areva are anticipating a competing bid. There is a break clause compensation of US$75 to Areva but subject to certain conditions. I wonder what they are? It seems like the compensation is not guaranteed if Areva's bid fails.

[ppowerscourt] 15/6/2007 20:06

slight improvement now to Can$8.8, representing 10.83%, over 25mil shs traded. Sold half, bought back at 407....looking for another 10% or so.

[pec2004] 15/6/2007 19:50

c$8.75 now in Can which is £4.14, bodes well for Monday morning although I did sell half at 400p like quite a few on here.

In hindsight a mistake but funds went into CHL so can`t complain.

[nielsc] 15/6/2007 19:47

Sold a third of my holding just before closing. Have left the rest to run. Looks like I made the right choice.

Of course it would have been best to not sell at all, but always good to get a healthy profit into the bank.

O/T
A great week for UMN. Anyone looking for early stage Uranium plays with a sound footing should have a look at VML. Pretty good prospects in my opinion.

I think somebody mentioned KAH which I might have a look at myself over the weekend.

Cheers,
Niels

[papillon] 15/6/2007 19:30

Still going up in Canada.

[marnewton] 15/6/2007 17:39

Good spot LSN;@)

M

[lowersharpnose] 15/6/2007 17:33

Netsdeal,

Yep. It was buried in the release, almost like small print. It should have been right at the top with the cash offer value.

What we are seeing now is the market trying to put a value on Niger plus any bidding war expectation.

rgds
lowerSharpnose

[netsdeal] 15/6/2007 17:22

ah, LSN, that might explain the rise after...

[sagem] 15/6/2007 17:06

Still buying in Canada and share price up 7.4% and rising.

[sagem] 15/6/2007 17:01

Have you all seen this I got it of the Canadian bulletin board ;-

[lowersharpnose] 15/6/2007 16:49

Concurrently with the closing of the proposed offer, UraMin will declare a
dividend payable in shares of the capital of Niger Uranium Limited held by
UraMin (where permitted by law) or a cash equivalent of the value of such
shares.

So, it is cash purchase of all of UraMin's assets, except Niger, which is to be given to exisiting shareholders - either in shares in the new company or cash.

Question is, what is the value of the Niger JV?

rgds
lowerSharpnose

[simonbroughton] 15/6/2007 16:47

SAGEM,

I think we all agree that the take out price is too low.

[rim job] 15/6/2007 16:47

Yestaday me a tell ya boombaclats dat ta tak out price was £3.89.

Ya all diss me cuz I is a Brudder and cuz I is black.

OK - i was a 3 pence out cuz I was using me rate dat I get me Ganja for when I is New York

No hoo laugh at me noow.

Me broker a tell me to buy some IVK too.


Rim Job - 14 Jun'07 - 12:48 - 2264 of 2344 edit

I hear takeout price is £3.89.

[simonbroughton] 15/6/2007 16:45

I think UMN has done well to delay an announcement until today. This should stimulate a bit of speculative froth over the weekend but I am slightly concerned that they accepted Areva's offer. This seems to undermine any growth in the share price but, at least, it sets a bottom line. I resisted the temptation to sell in the hope that another bidder comes in.

[sagem] 15/6/2007 16:45

They are still buying in Canada, so they think a counter bid will be made.

[sagem] 15/6/2007 16:31

NOW HEAR THIS/////////////JUST wait till the Weekend Press get hold of this, come Monday these shares will be rocketing...It may even leave £5.00 way being URANIUM is the RED HOT COMMODITY,

[marnewton] 15/6/2007 16:25

pp,

Sorry, busy unwinding some options.

I don't think the chart is going to help much in these circumstance.

If, IF, we've had a Flag over the past few days then a very rough target of 446p is on the cards...but as I say even I wouldn't rely on a chart target at the moment.

M