China, tempted by Husab, makes £756m offer for Kalahari

Uranium Mining in Namibia_China makes offer for Kalahari takeover

Uranium Mining in Namibia_China makes offer for Kalahari takeover

China Guangdong Nuclear Power Group Co., a Chinese state-owned nuclear power company, interested in acquiring a stake in one of the world’s largest uranium projects, has made a £756m offer for a takeover of Kalahari Minerals Plc.

With oil prices surging, China has been scrambling to secure alternative, and increasingly scarce, sources of energy. Husab, the world’s fifth-largest known primary uranium deposit in Namibia, is owned by Australian Explorer Extract Resources. With Kalahari owning 43% of Extract, taking over Kalahari would mean acquiring a stake in Husab – a very tempting deal for a number of major powers looking at investing in alternative energy.

China Guangdong’s offer for Kalahari is 17% above the average price of the target’s shares in the 20 trading days before the announcement.

If completed, the move would constitute one of the largest investments made by China in a London- company and the latest of a series of deals in which Chinese groups have acquired strategic mineral concessions in Africa.

Extract too? No thank you.

Uranium Mine and Mill

Uranium Mine and Mill

With Kalahari owning 43 percent of Extract, Australian rules would normally require China Guangdong to make an offer for all of the company. However, according to Simon Tonkin, an analyst at Patersons in Perth, China Guangdong wants to buy Kalahari without triggering a bid for all of Extract.

China Guangdong has said in a statement that its proposed bid is conditional on the Australian Securities and Investment Commission (ASIC) granting an exemption with regards to China having to make a takeover offer for Extract while allowing it to acquire more than 20 percent of Extract through the Kalahari takeover. An agreement with ASIC on an exemption from provisions of the Australian Corporations Act may include a requirement to “make a downstream offer to Extract shareholders,” the Chinese company said.

The Australian explorer Extract on the other hand has announced in a statement that it will address “any proposal or offer for Extract at the appropriate time”. Also, Extract has said that the exemption should proceed only if shareholders of Extract are “not disadvantaged in any way” and can receive “no less than equivalent terms to those offered to Kalahari shareholders,” the Perth-based company said today.

China’s Energy Needs

China may raise its 2020 target for atomic power generation to 86 gigawatts, with annual investment of 70 billion yuan ($10.7 billion), the state-run China Daily said Jan. 26. In comparison, capacity may total 11.7 gigawatts by the end of 2011, the National Energy Administration said.

The country is likely to surpass the U.S. as the world’s largest consumer of uranium during the 2020s as the nation’s imports rise sharply to feed a growing nuclear industry, a high-level energy official was reported as having predicted.

China is planning to construct as many as 187 nuclear reactors in addition to the 13 it already has, according to the World Nuclear Association.

CRU, a commodities consultancy, said Chinese demand for uranium would quadruple in the next 10 years and by 2030 the country was expected to surpass the US as the world’s largest consumer of uranium.

Carrie Ann
Carrie Ann is Editor-in-Chief at Industry Leaders Magazine, based in Las Vegas. Carrie covers technology, trends, marketing, brands, productivity, and leadership. When she isn’t writing she prefers reading. She loves reading books and articles on business, economics, corporate law, luxury products, artificial intelligence, and latest technology. She’s keen on political discussions and shares an undying passion for gadgets. Follow Carrie Ann on Facebook

Leave a Reply

Your email address will not be published.

Recent Posts

Cryptocurrency Market Updates: Bitcoin Could Hit $500,000 Per Coin

Cryptocurrency Market Updates: Bitcoin Could Hit $500,000 Per Coin

On March 15, Novogratz went so far as to predict that the Bitcoin future price will reach half a million dollars per coin by 2027. He made this statement at the Bitcoin 2022 confer
12 hours ago
Klarna CEO Uses Pre-Recorded Message For Laying Off Employees

Klarna CEO Uses Pre-Recorded Message For Laying Off Employees

Managers and HR personnel must be coached on how to compassionately convey the message as it is one of the most difficult conversations an individual can have. Open and honest comm
14 hours ago
China Might No Longer Be An Apple Manufacturing Country

China Might No Longer Be An Apple Manufacturing Country

The iPad manufacturer has previously sought to remove China as the main Apple manufacturing country. Trade tensions and a strict Covid-19 policy has previously resulted in supply c
1 day ago
D.C. Refuses to Let Zuckerberg Wash His Hands Off Cambridge Analytica

D.C. Refuses to Let Zuckerberg Wash His Hands Off Cambridge Analytica

In the same year, Racine had sued Meta, then known as Facebook, for failing to protect user privacy and deceiving them about how much data is collected and how it was used. The Att
2 days ago
Electronic Arts Shops Around For a Buyer

Electronic Arts Shops Around For a Buyer

However, Byers sheds light on the most recent Electronic Arts news saying, “Several sources familiar with these talks say EA has been persistent in pursuing a sale, and has only
2 days ago
EV Adoption Rates Helps Bring Down Global Oil Demand

EV Adoption Rates Helps Bring Down Global Oil Demand

Although electric car adoption rates are heartening, it is the electric two- and three-wheeler segment that has brought about a major shift in demand for oil. Especially popular i
3 days ago