Chinese say ‘No Deal’ to buy-out of besieged uranium miner’s Namibia project
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Besieged uranium miner Paladin Energy has failed to offload a majority stake in a Namibian mine which would have netted a much-needed $US416 million ($525 million).
Paladin — which is in administration — had been trying to sell its remaining 75 per cent stake in the Langer Heinrich Mine in central Namibia to Chinese joint venture partner CNNC Overseas Uranium Holding (COUH).
Perth-based Paladin, which brought in administrators from KPMG last month, was banking on COUH — which already owns 25 per cent of Langer Heinrich — buying the remaining stake plus outstanding interest bearing loans.
Back in March, COUH asked Paladin to determine a fair value for its share in the mine’s holding company, Langer Heinrich Mauritius Holdings.
An independent expert determined a value of about $US162 million for the 75 per cent stake and $US254 million for the loans.
Under a shareholder agreement with Paladin administrators, COUH had until the end of today to exercise the potential option.
Today administrators revealed COUH would not progress with the buy-out option.
“We will work with COUH to preserve the value of the Langer Heinrich mine and to minimise operating risk,” said KPMG administrator Matthew Woods.
“COUH’s decision allows a solid platform for a restructure of the group in the best interest of all stakeholders.”
Stockhead is seeking further comment from administrators in relation to the decision.
Administrators have been appointed up to September 29. Paladin is expected to remain suspended from trading at least until end of the administration process.
Paladin called in administrators last month after receiving a demand from French power utility Electricite de France (EDF) for overdue payment of $US277 million under a long-term supply agreement signed in 2012.
Paladin had sought a delay in payments.
EDF rejected the request, demanding full payment on July 10, which forced the company into administration.