takeover offer they look cheap

Elkedra receives takeover bid from Canada's Vaaldium
11:41, Wednesday, July 04, 2007

Sydney - Wednesday - July 4: (RWE Aust Business News) - Elkedra
Diamonds NL (ASX:EDN) has received an offer from Canadian listed diamond
group Vaaldiam Resources Ltd to acquire all of the outstanding shares of
Elkedra in exchange for Vaaldiam common shares by way of a scheme of
arrangement.
The proposed terms are 0.52 Vaaldium shares for each Elkedra
share, which at the current Vaaldium share price values Elkedra at 53c
per share, a 60 per cent premium to the current ASX and AIM trading share
price.
Vaaldiam has also made an offer to acquire all of the outstanding
shares in explorer Great Western Diamond Corp.
The directors of Elkedra believe there is considerable merit in
the proposed merger of these three companies and their respective spread
of complementary diamond assets in South America and Canada and has
unanimously agreed to recommend the Vaaldiam offer to Elkedra
shareholders, subject to no competing and more favourable bid being
received.
The company said that upon Vaaldiam completing the Elkedra scheme
of arrangement and the Great Western offer, the resulting merger of
Vaaldiam, Elkedra and Great Western will create a leading diamond
production, exploration and development company with a pro forma market
capitalisation in excess of $C160 million.
The 'new' Vaaldiam will have the ability to substantially fund
the consolidated group's advanced-stage kimberlite exploration and
development costs from cash flow, thereby reducing dilution to its
shareholders.
The combined group will have strong management expertise and
financial capacity to realise the potential value of the extensive
exploration portfolio and to capitalise on future acquisition
opportunities.
Shares of Elkedra Diamonds were 1c firmer at 34c prior to the
announcement, and are due to resume trading at 12:25pm EST today.
ENDS