Canadians Bid $19.7m For Uranium Debutante
Sydney Morning Herald
Thursday January 12, 2006
URANIUM exploration stocks continue to generate fast bucks for investors, with the recently listed Hindmarsh Resources becoming the subject of a generous $19.7 million scrip-only takeover bid from Canada's Mega Uranium.
The agreed offer also heralds the re-entry into the Australian uranium industry of Tony Grey, the Sydney-based Canadian lawyer who founded Pancontinental Mining in the early 1970s. Pancon was the group that discovered the rich Jabiluka deposit in the Northern Territory. The deposit, now owned by Rio Tinto, has yet to be developed after being blocked by the Hawke Labor government's ban on new uranium mines and, more recently, a power of veto on its development held by traditional landowners. Mr Grey is a director of Mega, which is headed by Canadian venture capitalist Sheldon Inwentash. Through a series of rapid-fire deals under Mr Inwentash, Mega recently secured ownership of two undeveloped uranium deposits in Queensland: Ben Lomond near Townsville and Maureen near Georgetown, Queensland. While uranium mining is banned at present in Queensland, no such problem exists in South Australia where Hindmarsh's uranium exploration is focused. Hindmarsh joined the ASX on July 11 after raising $560,000 from an issue of shares at 28c each. The raising was part of the group's conversion from a cash-box on the Newcastle Stock Exchange to a focused SA uranium explorer backed by most of the main players in the Adelaide mining market. Under the Mega offer, Hindmarsh shareholders will be offered 100 Mega shares for every 694 Hindmarsh shares. Option holders will also participate. The offer values the group's shares at 78c each based on Mega's closing price on Monday. Hindmarsh shares yesterday surged 13c to 68c in response to the offer. Hindmarsh directors said they would recommend shareholders accept the bid.Ownership of Hindmarsh will deliver tenements covering 13,600 square kilometres of SA.
© 2006 Sydney Morning Herald