egoli - News & Views

Paladin makes $1bn bid for Summit

What a difference 10 years makes - when Summit pegged these leases , nobody wanted to know about uranium -- now they are a billion dollar asset - well done Alan

Paladin Resources Limited (PDN) today announced a takeover bid for Summit Resources Limited (SMM). The offer comprises one fully paid ordinary Paladin share for every 2.04 fully paid ordinary Summit shares, implying a price of $5.12 per Summit share based on recent trading levels.



AdvertisementThe uranium miner said the offer values Summit at approximately $1.01 billion and represents a premium of approximately 34% to the volume weighted average price for Summit shares over the last 10 trading days. Summit managing director Alan Eggers today said the company would carefully consider Paladin’s bidder’s statement before providing a formal response. He said the company’s board would convene shortly after it receives the bid documentation. “This offer is not unexpected and, in my opinion, is designed to capture value that will otherwise flow to Summit’s shareholders. We will be communicating more fully about this with our shareholders shortly,” he added. "At this stage shareholders should take no action, ignore all communication from Paladin and await our further advice." Summit is a Western Australia based exploration company with interests in uranium, copper, gold, phosphate and iron ore exploration projects in northwest Queensland. The most advanced project in Summit’s portfolio is the Valhalla uranium deposit situated near Mount Isa. The deposit is part of the Isa Uranium Joint Venture Agreement, of which Summit is manager and holder of a 50% interest with Paladin holding the remaining 50%. Paladin said the proposed takeover represents a significant step forward in its growth strategy. “By accepting the offer, Summit shareholders will become shareholders in a uranium producing company which enjoys excellent exposure to current strong uranium pricing,” the company concluded. At 1450 AEDT, shares in Paladin Resources were 25c lower at $10.05, while shares in Summit Resources were up $1.08 or 27% at $5.08.