21st Apr 2008 10:00
Niger Uranium Limited21 April 2008 For immediate release 21 April 2008 Niger Uranium Limited ("Niger Uranium" or the "Company") Acquisition of substantial interest in UrAmerica plc ("UrAmerica") Niger Uranium, the uranium focused exploration and investment company withinterests in Niger and Namibia, announces that it has acquired an initial 20.89per cent. strategic interest in UrAmerica (increasing to 33.58 per cent. on afully diluted basis), a private company with uranium exploration projects inArgentina, Paraguay and Colombia. Ian Stalker, Deputy Chairman of Niger Uranium, said: "Niger Uranium continues to build an exciting portfolio of uranium projectsalongside the development of its wholly-owned uranium exploration projects inNiger on which encouraging drilling results have recently been announced. Thisstrategic investment in UrAmerica gives us entry into Argentina, a prospectiveuranium district that we have been targeting for some time. This investment addsto our recently acquired interest in Namibia. "UrAmerica has exciting uranium exploration projects in Argentina with anestablished management team with strong technical skills. We look forward toworking closely with the UrAmerica team on an accelerated programme ofexploration." Niger Uranium has today subscribed for 4,421,000 new ordinary shares inUrAmerica ("UrAmerica Ordinary Shares") representing 20.89 per cent. ofUrAmerica's enlarged issued share capital, at a price of US$1.093 per newUrAmerica Ordinary Share (the "Purchase"). In addition, Niger Uranium has beenissued with 4,421,000 warrants to subscribe for a further 4,421,000 newUrAmerica Ordinary Shares at an exercise price of US$1.639 per new UrAmericaOrdinary Share (the "Warrants") which are exercisable at any time within thenext two years. Accordingly, on completion of the Purchase and the exercise infull of the Warrants, Niger Uranium will own 8,842,000 new UrAmerica OrdinaryShares representing approximately 33.58 per cent. of the diluted enlarged issuedshare capital of UrAmerica. The consideration for the Purchase has been satisfied by an initial cash paymentof US$2.5 million (financed from the Company's existing cash balances) and theissue of 4,664,306 new Niger Uranium Ordinary Shares representing 4.5 per cent.of Niger Uranium's enlarged issued share capital. In aggregate, based on theclosing mid-market price of 19.5 pence per Niger Uranium Ordinary Share on 18April 2008, the total consideration for the Purchase amounts to approximatelyUS$4.3 million. In addition, the cost to Niger Uranium of exercising all of theWarrants would be approximately a further US$7.2 million. In Argentina, UrAmerica enjoys two prospecting licence applications coveringover 1,800 km2 in the provinces of Chubut and Salta, the two most prospectiveuranium districts in Argentina. The licence applications in Argentina are inclose proximity to known uranium deposits, the Cerro Solo deposit, Chubut andthe Don Otto Mine in Salta. The geology of Cerro Solo has been described as astratabound sandstone and conglomerate, braided stream uranium-molybdenumdeposits of the 'roll front' type. The Salta uranium targets are red continentalsandstone deposits that carry uranium, copper and vanadium. UrAmerica hasconducted a preliminary geological programme which has endorsed the explorationpotential of the projects. The proceeds of the subscription will be used byUrAmerica to fund its initial drilling programme. The acquisition of a significant stake in UrAmerica provides Niger Uranium witha strategic interest in highly prospective areas in South America and enablesthe Company to broaden its portfolio of exploration uranium assets bydiversification into new countries. On completion of the Purchase, Ian Stalkerwill join the board of UrAmerica as a non-executive director. Application will be made for the new Niger Uranium Ordinary Shares to beadmitted to trading on AIM, following which Niger Uranium's enlarged issuedshare capital will amount to 104,664,306 Ordinary Shares. Admission of the newOrdinary Shares is expected to become effective on 17 April 2008. UrAmerica hasentered into a lock-in agreement by which it has agreed not to sell or otherwisedispose of its interest in the new Niger Ordinary Shares for a period of sixmonths. UrAmerica has published no published financial results since incorporation on 1June 2007. The Purchase is not expected to have a material impact on NigerUranium's earnings in the current year. Contacts: Niger Uranium Limited Tel: + 27 (0) 11 269 4900James Mellon, Non-Executive ChairmanIan Stalker, Executive Deputy Chairman and ChiefExecutive Officer Beaumont Cornish Limited Tel: + 44 (0) 20 7628 3396Roland Cornish / Michael Cornish Haywood Securities (UK) Limited Tel+ 44 (0) 20 7031 8011Thomas Beattie Financial Dynamics Tel + (0) 20 7831 3113Ben Brewerton / Ed Westropp ENDS This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
Uru Metals