Uranium junior Forsys Metals has terminated its agreement to be acquired by George Forrest International (GFI) and will seek C$20m from the company for breaking the transaction.

Forsys stated that GFI failed to transfer the necessary funds to complete the C$579m transaction and that it was no longer in the best interests of the company to grant further extensions.

Forsys owns the Valencia uranium project in Namibia where production is expected to commence in 2011 with a 15-year mine life.

Forsys CEO Duane Parnham said that GFI had agreed to deposit funds for the transaction on or about 17 August, a deadline that was extended to 24 August.

“It is disappointing that after all of the support and assistance that the company has given to GFI over the last several months, during very difficult economic conditions, that this transaction could not finally be completed,” Parnham said.

The board is actively exploring other options including project financing, joint ventures and a possible sale of the company.