Sarah-Jane Tasker From: The Australian May 03, 2011 12:00AM
EXTRACT Resources shares have been placed in a trading halt ahead of an announcement on China's bid for the uranium company's major shareholder.
The shares, which last traded at $6.68, were halted as Extract waited for the information on Chinese state-owned CGNPC Uranium Resources' offer for Kalahari Minerals, which has a 43 per cent stake in Extract.
Because of Kalahari's stake, CGNPC is seeking relief from the Australian Securities & Investments Commission to acquire a relevant interest in more than 20 per cent of Extract.
The regulatory deadline was yesterday, but there was no sign from China or ASIC as to whether the application was granted. Extract requested the trading halt until tomorrow.
Extract's independent directors had asked ASIC not to grant CGNPC's request, or that it be conditional on CGNPC's offer for Kalahari being extended to all Extract shareholders.
Mining giant Rio Tinto, which operates the Rossing uranium mine neighbouring Extract's project, has a 14.2 per cent stake in Extract and has been regarded as a rival bidder if China is forced to move on Extract. The Namibia-focused company said it was confident its Husab project would not be adversely affected by proposed changes to Namibia's minerals policy.Extract's shares were punished by investors last week on speculation that changes to the mining policy would affect its operation but the Namibian government said late on Friday the new policy would not apply to current licences.
"Extract continues to have regular and positive consultation with the government of Namibia in relation to its Husab uranium project," the company told the Australian Securities Exchange.
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