I don't want a Sino take over at a low ball price, I hope the offer for KAH falls on its proverbial. No current shareholders will see any benefit of a 50 year income stream if this happens. If Chinese interests gain a 50% plus stake in EXT then pricing will be rigged to disenfranchise minority shareholders. This happens elsewhere in Africa to rip off the locals ... Sino colonialism at its unoriginal worst.
The share price will drop significantly in that event but I intend on increasing my stake if that happens... uranium is a long term countercyclical commodity play at the moment. EXT is only holding up better than its peers because of the current take over prospects.
The best scenario is for EXT to raise the $1.65B capex alone or in a JV with RIO/others for opencast mining Husab in 2013 or later aiming for 15m lbs/annum with a significant dividend for all in a few years, and a SP north of $30. Worse case scenario is a stalled take over with a large uncooperative Chinese or other shareholder (sounds a but like that with KAH already !...) that adversely affects EXT prospects and the interests of smaller shareholders.
So selling now is the classic "prisoners dilemma".
EXT Price at posting:
$8.47 Sentiment: None Disclosure: Held
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