5-June-07. Canadian uranium giant Mega Uranium Ltd will take a 5...

5-June-07.

Canadian uranium giant Mega Uranium Ltd will take a 5 per cent stake in West Perth-based uranium explorer Scimitar Resources Ltd, after the company raised $5.1 million through a placement with a number of investors.

Mega, which took over Nedlands-based uranium group Redport Ltd in November last year, will subscribe for 2.2 million shares from the company's issue of 6 million, raising money for the continued exploration of its projects in Western Australia and South Australia

The directors of Scimitar Resources Ltd (ASX: SIM ) are pleased to announce that the Company has arranged a private placement to raise gross proceeds of up to $5.1 million through the issue of 6 million ordinary fully paid shares in the capital of the Company at an issue price of A$0.85.

Leading uranium exploration and development company, Mega Uranium Ltd ("Mega") has agreed to subscribe for 2.25m shares representing approximately 5% of the post placement issued capital of Scimitar. Mega is a Canadian publicly listed resources company focusing on uranium exploration and development. Mega already has a strong presence in Australia following takeovers of Hindmarsh Resources Limited and Redport Limited as well as an investment in Northern Uranium Limited.

Mega controls a number of advanced uranium projects in Australia featuring established resources including Ben Lomond, and Lake Maitland.

Hartleys Limited facilitated the placement to institutional and other sophisticated investors including Mega. Clients of Perth firm Barclay Wells Limited will also participate in the private placement. The new shares will be issued pursuant to the "excluded offer" provisions (Section 708) of the Corporations Act. Settlement is expected to be on or about the 10 July 2007, and subject to the shareholder approval which is being sought at a General Meeting of Members to be held on that date.

Commenting on the placement Managing Director Terry Topping stated: "We are delighted to welcome Mega to the share register. Mega's strong financial resources and technical expertise will provide a complementary support to our exploration activities."

The Company will utilise the funds raised in the placement for the continued exploration of its portfolio of uranium assets with initial emphasis on the Yanrey Uranium Project in Western Australia and the Lake Frome Project in South Australia.