Johannesburg, South Africa — 23 May 2012 – Gold One International CEO Neal Froneman has stated that the company will not offer more for First Uranium’s Ezulwini mine than the US$70 million that was already on the table, pointing out that nobody was likely to make a success of the asset as a stand-alone operation.
Miningmx reports that the disposal of Ezulwini to Gold One, together with AngloGold Ashanti’s proposed acquisition of Mine Waste Solutions for US$335 million, would be voted on by First Uranium’s shareholders on 13 June as the company seeks to cover debts from the sale of key assets.
A significant number of minority shareholders in First Uranium have voiced their opposition to the deals, saying the assets were priced too cheaply. First Uranium has so far spent US$400 million on shaft refurbishment and the construction of a gold and uranium plant at Ezulwini.
First Uranium’s TSX-listed shares traded in excess of C$12 in 2007, while the company did a fundraising at C$1.00/share in March 2011. Following the disposal of Ezulwini and Mine Waste Solutions, the company’s shareholders would realistically receive no more than C$0.11/share in distributions.
“I’m not insensitive to objections because people have lost a lot of money here, but the valuations proposed by some First Uranium shareholders do not make sense,” Froneman told Miningmx. “I don’t think shareholders have viable alternatives. My board was particularly critical about the price we’re offering because they could see the risk we’re taking on.”
Froneman said he didn’t believe Ezulwini could viably operate as a stand-alone operation. Ezulwini is contiguous to Gold One’s Cooke operations which the company acquired as part of the Rand Uranium transaction in 2011.
Source: Miningmx. For more information, click here.