Bannerman Resources has received a highly conditional proposal from Hanlong Mining Investment, a subsidiary of Chinese conglomerate Sichuan Hanlong Group, for the acquisition of Bannerman for Aus$0.612 cash per share by way of a scheme of arrangement.
The Board of Bannerman believes that Hanlong recognises the strategic significance of controlling Bannerman’s large-scale and low technical risk Etango Uranium Project in Namibia. The Board also believes that Hanlong’s approach has been timed to take advantage of Bannerman’s low share price which has been adversely affected by macro issues such as the events at Fukushima and weak global equity markets.
Bannerman chairman Dr David Smith says, “It is understandable that Bannerman is now attracting corporate interest. Bannerman controls one of the largest undeveloped uranium resources in the world and, despite recent events, there is no doubt that nuclear power will continue to play a key role in meeting the world's growing energy needs as well as alleviating greenhouse gas emissions. Etango is a strategic asset which is highly leveraged to a stronger uranium price in a world where security of supply is one of the most important issues for nuclear power generators and utilities.”
Bannerman has been undertaking a process to identify a suitable joint venture partner to facilitate the financing, development and operation of Etango. As part of this process, Bannerman has been in discussions with a number of large and well-funded parties.
As part of its proposal, Hanlong is seeking a three month period of exclusivity. Bannerman has resolved that it is not appropriate to grant Hanlong exclusivity given the absence of agreement on price and the conditionality of the proposal.
Accordingly, in addition to holding discussions with Hanlong in relation to its proposal, Bannerman intends to continue to advance its joint venture discussions with third parties in order to explore all options for delivering the best possible outcome for Bannerman shareholders.
Bannerman is an emerging uranium development company with interests in two properties in Namibia. Its principal asset is the 80%-owned Etango project to the southwest of Rio Tinto’s Rossing uranium mine and to the west of Paladin Energy’s Langer-Heinrich mine. Bannerman is focused on the feasibility assessment and development of a large open pit uranium operation at Etango.