Merging uranium miners eye Australia - Breaking News - Business - Breaking News

Merging uranium miners eye Australia -

Canadian uranium miner sxr Uranium One Inc has agreed to acquire national rival UrAsia Energy Ltd in a deal that will create the world's second biggest uranium miner by market capitalisation.
The merged company would be worth about $US5 billion ($A6.45 billion) and be the only company to possess mines in Australia, the United States, South Africa, Canada and Kazakhstan.
sxr Uranium One owns the Honeymoon Uranium project in South Australia, which it said is set to come into production in the first quarter of 2008.
"We recently awarded a ... contract to Bateman Engineering out of their Brisbane office and they will be running the project for us and building the project for us," sxr Uranium One vice president, Australia Asia Greg Cochran, told journalists.
If the merger is approved the company will be named Uranium One Inc.
Stock market listings in the United States and Australia are under consideration, Mr Cochran said.
The new company's combined attributable annual production will be in excess of seven million pounds of uranium oxide from five operations in 2008, jumping to 12 million to 15 million pounds of uranium oxide by 2012.
The initial contribution from Australia will be small, Mr Cochrane said.
"Unfortunately, it will initially be rather small because Honeymoon is only an 880 thousand pound per annum producer," he said.
But the company will look to build new mines in Australia, Mr Cochran said.
"We do believe in time the debate around the no new uranium mines policy will subside and that uranium mining will be more open and more accessible in other states beyond South Australia and the Northern Territory."
Mr Cochran said the company was "fairly confident" the Australian Labour Party would overturn its no new mines policy in April.
He said Uranium One would consider buying Australian miners to expand.
"We'd certainly do have aspirations to be an ongoing consolidator in the sector be it in Australia or anywhere else in the world," Mr Cochran said.
He did however, except many uranium companies are expensive at present.
"It is difficult to see value, and so the key question there is recognising early-on potential players that have some interesting projects or prospects that we could add value to."
Under the terms of the acquisition, UrAsia shareholders will receive 0.45 common shares of Uranium One for each issued share of UrAsia, representing a value of $C7.05 per share based upon the closing price of Uranium One on the Toronto Stock Exchange on February 9.
Mr Cochran said this represented a 13 per cent premium on the closing price of UrAsia on February 9.
A shareholder vote on the merger will be held in April.