China flexed its nuclear muscles last night when it launched a £756 million takeover of the London-listed uranium producer Kalahari Minerals. The prize is the Husab uranium project in Namibia, the fifth-largest uranium mine in the world that some believe has the ability to become the biggest.
Kalahari said that it was in discussions that could lead to a recommended takeover of the company by CGNPC-URC, the uranium mining business of the state-owned China Guangdong Nuclear Power. CGNPC is seeking Kalahari’s 43 per cent stake in Extract Resources, an Australian company that owns the Husab project.
Last month Extract opened talks with Rio Tinto about merging its operations with Rio’s neighbouring Rossing uranium mine.
CGNPC is offering 290p a share for Kalahari, an 11 per cent premium on the shares’ closing price on Friday. Mark Hohnen, the executive chairman of Kalahari, said that he believed CGNPC was a “suitable partner” and that its offer “represents attractive value”.