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Minority shareholders decide to back First Uranium asset sales
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12th June 2012
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JOHANNESBURG ( – A group of minority First Uranium shareholders, led by Nick Betsky from Olma Investments, on Monday said it would now support the sale of the Ezulwini gold and uranium mine and Mine Waste Solutions (MWS).

TSX- and JSE-listed First Uranium said Betsky wrote to its board on behalf of Olma, Stratton Enterprises and Patto Corporate Services, indicating that they would vote in favour of the transactions at Wednesday’s shareholders' meeting.

The group of shareholders has been opposing the sale of Ezulwini to the Chinese-owned Gold One for $70-million and MWS to AngloGold Ashanti for $335-million, accusing the beleaguered miner of selling its core assets too cheaply.

“In light of the company’s June 6 announcement of the increased distribution to shareholders to the amount of $75.9-million or 33 Canadian cents a share, we plan to support the proposed transactions on June 13,” First Uranium quoted Betsky as saying.

Betsky also reportedly lambasted the board, saying the shareholders felt strongly that directors and management had not acted in the best interest of shareholders, but owing to the time constraints, at this point they saw no other choice but to approve of the transactions.

Betsky stated that the group of shareholders, which had started preparing for the legal proceedings against the board, would drop its legal action if the distribution to the shareholders amounts to no less than 33 Canadian cents a share.

Meanwhile, First Uranium said that its board rejected a “highly conditional” offer from Kumvest, led by Mandla ‘Bear’ Kumalo.

“On the advice of financial and legal advisers, the board decided there is no basis to proceed with this proposal,” the company said in a statement.

Kumalo told Mining Weekly Online on Monday that he would pursue an interest in the Ezulwini mine regardless of the outcome of his proposal, or the outcome of shareholder voting with regard to the two transactions, adding that he would engage any subsequent owner of the mine.

The company's Toronto-listed stock gained 21.05% on Monday, closing at 4 Canadian cents a share.

Edited by: Creamer Media Reporter


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Picture by: Duane Daws