Sichuan Hanlong bids for resources group

SYDNEY - China's Sichuan Hanlong Group has made a A$144 million ($154.9 million) "highly conditional" bid for Australia's Bannerman Resources Ltd, eyeing the group's uranium project in Namibia near key mines.

The bid at A$0.612 a share represents a 59 percent premium to Bannerman's close on Friday, but Bannerman said privately owned Sichuan Hanlong was trying to take advantage of recent share price weakness in the wake of Japan's Fukushima nuclear crisis.

"The board of Bannerman believes that Hanlong recognizes the strategic significance of controlling Bannerman's large-scale and low technical risk Etango Uranium Project in Namibia," the company said.

It has been trying to find a joint venture partner to help finance, develop and operate its 80 percent-owned Etango project, southwest of Rio Tinto Group's Rossing uranium mine and west of Paladin Energy's Langer-Heinrich mine.

Bannerman, being advised by Macquarie Capital, part of the Macquarie Group, and Cutfield Freeman & Co, said it will continue to talk with Hanlong though it will not grant it exclusivity, and will also continue discussions with others for a joint venture.

Hanlong's bid comes two months after State-owned China Guangdong Nuclear Power Group was forced to withdraw an offer for UK-listed Kalahari Minerals Plc after UK regulators blocked it from cutting its bid after the Fukushima disaster.

Kalahari's key asset is a 43 percent stake in Extract Resources, which owns the Husab uranium project in Namibia, potentially the second-largest uranium mine in the world.

Hanlong is already the biggest shareholder in Australia's Sundance Resources Ltd, developing a $4.7 billion iron ore project in West Africa, and the majority shareholder in Moly Mines, developing a molybdenum and copper project in Western Australia.

Reuters

(China Daily 07/12/2011 page16)