Energy Metals signed a binding implementation deed on Tuesday that will see Uranium Resources Co. (URC), a subsidiary of China Guangdong Nuclear Power Group, make a proportional off-market takeover bid for 70% of the company’s shares.
URC will offer each Energy Metals shareholder $.102 per share.
The company’s directors unanimously recommend that the shareholders accept the bid in the absence of a superior proposal.
Jindalee Resources, which owns 40% of the company’s issued capital, has stated it intends to accept the bid, according to Energy Metals.
Following the successful completion of the bid, Energy Metals intends to raise approximately $11.7 million, through a 1:9 rights issue at $0.90 per share.
The proceeds raised will be used, among other things, to accelerate the development of Energy Metals’ Bigrlyi project, the company said.
Energy Metals will have approximately $14 million of cash following completion of the rights issue.
According to Energy Metals, URC is supportive of the company’s goal of becoming Australia’s next uranium producer.
“It has a proven ability to finance the development of resource projects, which has been seen in joint venture projects with large international companies, including the Kazakhstan nuclear fuel producer Kazatampom,” the company said.
The bid is subject to Australian and Chinese Government approval and a minimum acceptance of 50.1%.
The bidder’s statement will be made available in late-September, after which, the bid must remain open for a month.