Paladin Resources Ltd (PDN)

[mlkrborn]

A$27.0(1) Million Recommended Takeover Offer by Paladin Energy Ltd for NGM Resources Limited
Date : 07/21/2010 @ 8:37AM
Source : MarketWire Canada
Stock : Paladin Energy Ltd (PDN)
Quote : 3.59 0.0 (0.00%) @ 12:23AM


A$27.0(1) Million Recommended Takeover Offer by Paladin Energy Ltd for NGM Resources Limited

Paladin Energy Ltd (TSX:PDN)(ASX:PDN)(NSX:PDN) ("Paladin") and NGM Resources
Limited (ASX:NGM) ("NGM") are pleased to announce that Paladin intends to make
an off-market scrip takeover offer ("Offer") for the shares it does not already
own in ASX listed minerals exploration company NGM. Paladin currently holds
approximately 22.5% of NGM's ordinary shares on issue, having recently acquired
4.3 million NGM shares at $0.09 per share.


The consideration under the Offer will comprise one fully paid ordinary Paladin
share for every 23.9 fully paid ordinary NGM shares that Paladin does not
already own, implying a price of A$0.15 per NGM share based on the closing price
of Paladin shares on the ASX on 20 July 2010 (being the last trading day prior
to announcement of the Offer) of A$3.58.


The Offer values NGM at approximately A$27.0(1) million and provides an
attractive premium of 54% to the 5 day volume-weighted average price of NGM
shares on the ASX on 16 July 2010 (being the last trading day in NGM shares
prior to the announcement of the Offer). The Offer is subject to a number of
conditions, which are set out in full in Appendix 1 to this announcement.


NGM's directors have unanimously recommended that NGM shareholders accept the
Offer, in the absence of a superior offer. They have also indicated that they
intend to accept the Offer in respect of their own shareholdings, in the absence
of a superior offer.


NGM Director Robert Kirtlan said shareholders would retain exposure to any
future success of the NGM projects, as well as benefit from Paladin's broader
portfolio of uranium projects in Australia and Africa.


"Paladin is well positioned with a strong balance sheet and management expertise
to fully exploit the world-class location of NGM's uranium assets," Mr Kirtlan
said.


NGM is a minerals exploration company with a significant land position in
Niger's uranium rich Tim Mersoi Basin, a region which has a long history of
uranium production and hosts some of the world's largest and highest grade
uranium deposits. NGM holds three uranium exploration concessions, covering an
area of approximately 1,500km2.


NGM's most advanced project is the Takardeit Project for which NGM announced, on
28 January 2010, a maiden inferred resource of 23 million tonnes at a grade of
210ppm, with an estimate of 11 million pounds of uranium oxide (U3O8) at 120ppm
cut off. The announcement of the maiden resource followed a drilling programme
undertaken in the last quarter of 2009, which identified supergene
mineralisation over an area of 2.7km by 2.1km. The mineralisation is shallow to
a depth of 30m and remains open to the south and south west.


The proposed acquisition will represent a significant addition to Paladin's
portfolio of early stage uranium exploration projects and importantly will give
Paladin a presence in a country with a long history of uranium production. The
potential acquisition of a large, under-explored land holding within the highly
prospective Tim Mersoi Basin will provide Paladin with the opportunity to
potentially unlock significant value by applying its proven uranium exploration
and development capabilities. Importantly the dilution to Paladin shareholders
is less than 1% and given the relative size of the companies, Paladin believes
that NGM can be easily integrated allowing Paladin to continue to focus on its
other strategic growth initiatives.


If the Offer is successfully completed, NGM shareholders will:



-- retain the exploration upside associated with NGM's projects;
-- benefit from becoming shareholders in a uranium producing company, and
inherit a management team and board with the requisite skills and
demonstrated ability to bring a uranium project into production; and
-- obtain increased liquidity of their investment through owning Paladin
shares.



Paladin and NGM have entered into a bid implementation agreement, a copy of
which is included in Appendix 2 to this announcement.


NGM has agreed to pay Paladin a break fee of A$400,000 in certain circumstances,
including if NGM enters into a competing proposal or if the NGM directors
withdraw or adversely modify their recommendation of the Offer. NGM has also
agreed to customary exclusivity arrangements in regards to solicitation of
alternative transactions. The Bid Implementation Agreement can be found in its
entirety on the Company's website at
http://investors.paladinenergy.com.au/phoenix.zhtml?c=176316&p=irol-news&nyo=0