Chinese take over Husab
A subsidiary of Chinese state-owned, Guandong Nuclear Power Corporation (CGNPC), has all but taken over control of the Husab project, after independent directors of Extract Resources announced this week that they have agreed to the company’s unconditional offer.
On 14 February, CGNPC through its subsidiary Taurus, launched a US$2.24 billion unconditional offer for Extract after announcing that it had successfully acquired 98% shares of Extract’s majority shareholder, Kalahari. Kalahari held 42.74% shareholding in Extract who in turn 100% owned the Husab project through Swakop Uranium.
On 8 December 2011 Taurus announced a recommended 243.55 UK pence per share cash offer for Kalahari. Taurus also announced that Australian Securities and Investments Commission had allowed the Kalahari offer to proceed on the condition that Taurus make an equivalent A$8.65 per share cash offer to all Extract Shareholders if Taurus received acceptances of the Kalahari offer in respect of more than 50% of the voting rights in Kalahari.
This week Extract says it believes the offer price of A$8.65 represents a premium to the implied value of the Taurus offer for Kalahari, being A$8.34 per extract share at current exchange rates.
Stephen Galloway, chairman of Extract said: “Your Independent Directors advise that, after a lengthy and exhaustive process, as at today (Thursday), no alternative and superior proposal to the Taurus Offer has been received, nor are there are any discussions underway with third parties that your Independent Directors believe are likely to lead to any superior proposal being made.
“With a number of short-term investors now holding significant positions in Extract Shares, your Independent Directors note the likelihood that Taurus will receive the requisite number of additional acceptances of the Taurus Offer to deliver it effective control of Extract, when combined with the 42.74% relevant interest in Extract that Taurus already holds through Kalahari..”
Early this year, Extract announced that the potential takeover of the company by the Chinese had already received the blessings of the Namibian Competition Commission.