Cameco, Canada's largest uranium miner, raised its offer for Hathor by 20 percent to C$4.50 a share, top a friendly bid from Rio Tinto at C$4.15 given that Rio Tinto had been in talks with Hathor since early 2010, investors expect Rio Tinto is excited to take over the company and would have a bit more up its sleeve to top Cameco, especially because the target is not large.
"It wouldn't be out of character for them to come up with a high bid. In the scheme of Rio, we're not talking about a lot of money," said Peter Chilton, an market analyst at Constellation Capital Management, which owns Rio Tinto shares, Rio Tinto decline to comment on the latest bid by Cameco.
Rio Tinto mines uranium in Australia, during its ERA unit, and owns the Rossing uranium mine in Namibia, but its Australian assets face environmental obstacles and the Namibia mine is considered fairly low grade the main attraction in Hathor is its great exploration-stage Roughrider project in the uranium-rich Athabasca region of Saskatchewan in Western Canada, which has the potential to make at least 5 million pounds of uranium a year.
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