ARMZ to buy remainder of Uranium One for $1.3 bln

MOSCOW. Jan 14 (Interfax) - Atomredmetzoloto (ARMZ), the uranium division of Russian state nuclear corporation Rosatom, is consolidating 100% of shares in Canada's Uranium One.

ARMZ will acquire all common shares in Uranium One not currently owned by the company and its affiliates at a price of CAD2.86 per share, which represents a 32% premium to the average price of the shares over the 20-day period ended January 11 (the last day of trading before the announcement of the deal), ARMZ said in a press release.

ARMZ will spend a total of about CAD1.3 billion ($1.32 billion) on the deal.

The deal is subject to approval by Uranium One shareholders, an extraordinary meeting of which is scheduled for March. The agreement with ARMZ must be supported by two thirds of votes from holders of common shares and by a majority of minority shareholders. The deal is also subject to approval by a number of regulators in countries where Uranium One has a presence. The deal is expected to be closed in the second quarter of 2013, after which Uranium One's shares will be delisted.

ARMZ closed a deal to buy 51.4% of shares in Uranium One at the end of 2010, paying for them partly in cash and partly with 50% of shares in joint venture Akbastau and 49.67% of shares in joint venture Zarechnoye (Kazakhstan).

Uranium One has a primary listing on the Toronto Stock Exchange and a secondary listing in Johannesburg. It was the first foreign company to place bonds in Russia and in 2011 even thought about a Russian listing.

"At the time of the consolidation of the controlling stake in the Canadian company, the stock market offered considerably broader opportunities for development in this regard. Now the situation has changed and a private format is more effective for meeting the challenges that we face," ARMZ chairman and Uranium One president Vadim Zhivov said in the press release, commenting on the change of plans.

He said that this was a friendly deal that is unanimously supported by the independent directors on Uranium One's board.

ARMZ's financial and legal advisers on the deal are BMO Capital Markets and Stikeman Elliott.

Uranium One planned to mine 11.6 million pounds of uranium in 2012 and 12.5 million pounds in 2013.

In Kazakhstan, Uranium One owns 70% of the Betpak Dala joint venture, which owns the Akdala Mine and the South Inkai Mine; 50% of the Karatau joint venture, 30% of the Kyzylkum joint venture (Kharasan project), 50% of the Akbastau joint venture and 40.67% of the Zarechnoye joint venture, which owns the Zarechnoye Mine and the South Zarechnoye Project. In the United States, the company owns 100% of the Willow Creek Project, and has a number of development projects in Wyoming. In Australia, Uranium One owns 100% of the Honeymoon Uranium Project. It is also the operator of Mantra Resources' Mkuju River project in Tanzania. Uranium One bought 14% of Mantra from ARMZ in March 2012 and has an option to buy out the remaining shares by June 2013.

Vp

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