HomeEast AfricaUranium One to acquire Mantra

Uranium One to acquire Mantra

Mantra senior management
examining drill cuttings
at the Mkuju River
Vancouver, Canada — MININGREVIEW.COM — 17 December 2010 – Canadian based and listed mining company Uranium One Incorporated and state-owned Russian miner ARMZ have announced that ARMZ has entered into a definitive agreement to acquire all of the issued shares of Mantra Resources Limited.

Mantra’s core asset is the world-class Mkuju River project in Tanzania which is nearing the completion of a definitive feasibility study.

This joint statement released here revealed that the two companies had concurrently entered into a definitive put/call option agreement giving Uranium One the right to acquire from ARMZ “’ and ARMZ has the right to sell to Uranium One “’ all of the Mantra shares for consideration equal to ARMZ’s acquisition cost plus certain additional expenditures.

The statement added that the joint strategy of Uranium One and ARMZ was to create a world-leading diversified uranium production company with high quality mines and development projects. Based on Mantra’s current public disclosure for the Mkuju River Project, this transaction:

  • Increases Uranium One’s NI 43-101 compliant measured and indicated resource by 68% and inferred resource by 34%
  • Enhances Uranium One’s diversified portfolio of assets with mines in Kazakhstan, the United States and Australia and the addition of a new development project in Tanzania
  • Increases Uranium One’s steady state annual production range to approximately 22 to 26 million pounds from approximately 18 to 20 million pounds

Uranium One has completed extensive due diligence on Mantra and believes that the Mkuju River Project has excellent potential to increase the current resource base, as well as the ultimate steady state production rate.

Uranium One CEO Jean Nortier said: “Uranium One believes that the Mkuju River Project ranks among the best uranium development projects in the world. Our option to acquire Mantra from ARMZ provides Uranium One with the opportunity to add this significant development project, to our existing portfolio of world-class operations and complements the long-term growth strategy of the company.”

ARMZ director-general Vadim Zhivov commented: “Our acquisition proposal provides all Mantra shareholders with the opportunity to realise cash consideration at a premium valuation. This transaction also highlights our continuing strong support of Uranium One as its majority shareholder.”