TORONTO, July 10 (Reuters) - Paladin Resources Ltd. launched a friendly A$174 million ($130 million) offer for Valhalla Uranium Ltd. on Monday. Australian-based Paladin, with uranium projects in Australia and Africa, said the acquisition will bolster its development pipeline and "provide further diversification in geographical, political and resource terms."
Valhalla, also based in Australia, has interests in a number of uranium projects in the country. Its board of directors is urging shareholders to accept the offer in the absence of a superior bid.
Paladin is offering Valhalla shareholders 1 share for every 3.16 Valhalla shares.
Based on Paladin's closing price of A$4.58 on July 6, that represents a value of A$1.45 per Valhalla share and a premium of about 41 percent.
Valhalla has agreed to pay Paladin a break fee of about A$1.2 million under certain circumstances. ADVERTISEMENT
Shares of Paladin, halted before the announcement, fell 12 Canadian cents to C$3.78 on the Toronto Stock Exchange.
Takeover documents are expected to be mailed within three weeks.
($1=$1.33 Australian)
VUL Price at posting:
0.0¢ Sentiment: Buy Disclosure: Not Held
