ARMZ sees $300 mln-$400 mln investment in Mantra
MOSCOW. Dec 16 (Interfax) - Investment in Australia's Mantra Resources will total $300 million-$400 million, and mining should begin in 2012-2013, Vadim Zhivov, general director of Russian uranium holding Atomredmetzoloto (ARMZ), told a press conference.
Uranium One, which is controlled by ARMZ, will invest the money. "It will finance the Mantra capex. "We'll also sign a deal on operational support for the project," he said. The project will have a life of 12-13 years.
ARMZ has offered to buy 100% of the shares in Mantra Resources Ltd, which mines uranium in Tanzania, for A$1.16 billion. ARMZ offered A$8 per share, or 21.2% above its average share price for the last 30 days. The offer also values Mantra at US$10.26 per pound of resource, which is significantly higher than other substantial uranium developers. Uranium One has signed an option to buy the 100% of Mantra at the price of their acquisition by ARMZ plus costs.
Asked whether ARMZ would fund the deal itself or borrow, Zhivov said: "We have the funds. I can say we'll be using the most optimal mode of payment."
Mantra's proven reserves are 101.4 million pounds, or 39,000 tonnes of yellowcake. "We expect this will increase, it's one of the best parameters for African fields," Zhivov said.