Extract Resources agrees to $2.4bn Chinese takeover offer

1 March 2012 (Last Updated March 1st, 2012 18:30)

Extract Resources independent directors have agreed to a A$2.2bn ($2.4bn) takeover offer from China Guangdong Nuclear Power Corporation (CGNPC).

Extract Resources independent directors have agreed a A$2.2bn ($2.4bn) takeover offer from China Guangdong Nuclear Power Corporation (CGNPC).

Directors of the company recommended that shareholders accept the A$8.65 ($9) cash offer from Taurus Mineral, an entity owned by CGNPC, in the absence of a superior proposal.

In its target statement released to shareholders, Extract said no alternative and superior proposal to the Taurus offer had been received nor were any discussions underway with third parties that were likely to lead to any superior proposals.

Extract Resources CEO and managing director Jonathan Leslie said: "Extract's Independent Directors have undertaken a thorough review of all available options, including various scenarios for development of the project, and have actively sought alternative proposals from third parties.

"In the absence of a superior proposal, Extract's Independent Directors believe that the offer from Taurus represents the most attractive outcome for shareholders.

"The cash offer delivers value and certainty for Extract shareholders and the Extract Board believes that Taurus is well placed to finance and develop Husab into one of the world's largest uranium mines for the benefit of all stakeholders, including the Namibian people."

The directors' recommendation of the Taurus offer takes into account the options available to Extract, including the value that the offer delivers for shareholders.

They also took into account the risks associated with financing and developing the Husab Uranium project in Namibia, especially in the context of current volatile global economic conditions.

Extract Resources is a uranium exploration and development company with primary focus in Namibia.

The company claimed its 100%-owned Husab Uranium project contains the third largest uranium-only deposit in the world.