TORONTO () -- The Endeavour people now have a uranium vehicle, and as usual they have gone big. The presently halted Signature Resources [TSXv:SRZ] is the putative subject of an RTO and a name change to UrAsia Energy.
The team will include Ian Telfer as non-executive Chairman, and the board of directors will consist of Phillip Shirvington, Frank Giustra, Bob Cross, Douglas Holtby, Dr. Massimo Carello and one other to be determined. The officers will be Phillip Shirvington, president and chief executive officer, and Gordon Keep, chief financial officer and secretary. Half of this list are former Yorkton, Endeavour people who are part of almost all of the large mining deals in Canada and in Europe.
This project is designed to be the blue chip vehicle for institutions to participate in the uranium bull market predicted by an increasing number.
"UrAsia has agreed to enter into a brokered private placement through a syndicate led by Canaccord Capital Europe Ltd. and including BMO Nesbitt Burns and GMP Securities Ltd. of subscription receipts at an estimated price of $2.00 (Canadian) to $2.50 (Canadian) per share to raise gross proceeds of $300-million (U.S.). The agents will also be granted a greenshoe option of up to $125-million (U.S.)."
Knowing this group, and the appetite for uranium, the greenshoe will most likely be filled. $425 million is one hell of a lot of money - more than was raised for Wheaton River in the early days, and it is also a big vote of confidence in Kazakhstan where all of the proposed assets are located.
As we told readers in late June when we reported on the Oriel story, Kazakhstan is a better place to do business than people realize.
The GDP of Kazakhstan is 41 billion dollars, which is more than the combined GDP of the four other 'Stans' and also more than the combined GDP of Georgia, Armenia and Azerbaijan.
"We (Kazakhstan) have done extremely well as compared to other Stans in the neighborhood," Kazakhstan President Nursultan Nazarbayev told United Press International in an interview. "We have one third of Central Asia's population and three fourths of its natural resources," he said.
Nazarbayev also told a recent gathering at the fourth Eurasian Media Forum that with radical market reforms he has hiked the per capita GDP of Kazakhstan from over $700 a decade ago to $2,700 by the end of last year.
Nazarbayev has pledged to the country's over 15 million people that by year 2010, the per capita GDP would be $5,800 making it first post Soviet Union nation to reach at par with Czech Republic, Hungary, Poland and Malaysia.
Indeed, Kazakhstan does appear to be a cut above the madness going on in the Stans right now, and investors forget, or are unaware of the fact that the country has the same bond rating as Mexico.
- UrAsia has the option to acquire a 30% indirect interest in the Kharassan uranium project located in south-central Kazakhstan in consideration for $75-million of which $37.5-million is payable in cash and $37.5-million is payable by the issuance of ordinary shares of UrAsia at the financing price. The other 70% interest in the project is held by Kazatomprom and another Kazakhstani entity.
- UrAsia has also entered into a memorandum of understanding pursuant to which it can acquire an indirect 70% interest in the Betpak Dala joint venture, which has interests (described below) in two uranium projects in Kazakhstan in consideration for $350-million, payable as to $234-million in cash and the balance by the issuance of ordinary shares of UrAsia at the lower of the financing price.
- UrAsia also intends to submit an offer to a public tender by the Kyrgyzstani government for the purchase of a 72% interest in the Kara Balti uranium mill, located in Kyrgyzstan.
It would appear that if this is consummated, UrAsia would have a market capitalization larger than all of the Canadian listed uranium plays save Cameco [TSX:CCO]. I believe that honour currently goes to International Uranium [TSX:IUC].
All of the assets will be concentrated in Kazakhstan, and by all appearances uranium reserves will be huge, the partner will be Kazakhstan's state energy company, and there will likely be uranium production in fairly short order.
The company will be run by a group that can raise money, promote, and has excellent relationships with the institutions. If uranium runs, this thing will be at the top of the list. One wonders if there will be a publicly listed, long life warrant?