China Guangdong Nuclear Power Group has made a tentative
offer to buy Kalahari Minerals in a move seen as driven by the firm’s stake in
a significant uranium project in Africa, Bloomberg reported Monday.
CGNPG may offer to buy the company’s stock at 11 percent
above its March 4 closing price. In a CGNPG statement, Kalahari’s CEO Mark
Hohnen indicated his board will recommend stockholders accept the offer, saying
“the Kalahari board believes this represents attractive value for Kalahari
shareholders.”
Kalahari, based in London, holds a 40 percent stake in Perth,
Australia-based Extract Resources, which is focused on developing the Husab
Project in Namibia. According to the Australian company’s website, Husab is the
world’s fifth-largest known primary uranium deposit. As CGNP would control more
than 20 percent of Extract, the deal is subject to approval from both Chinese
and Australian regulators.
Extract announced last month that it was in talks with Rio
Tinto, which owns the Rossing mine next door. Rio Tinto also owns 14 percent of
Extract and 11.5 percent of Kalahari, according to the Bloomberg report.
State-controlled CGNPG is China’s second largest nuclear
power firm. According to a recent report in China Daily, the national
government plans an annual investment of $10.7 billion in nuclear power over
the next ten years, with the goal of a nearly eightfold increase in nuclear
power generation over that time.