Uranium One and UrAsia Energy Announce Combination to Create Emerging Senior Uranium Company



    
    Trading Symbols:   SXR - Toronto Stock Exchange,
                       JSE Limited (Johannesburg Stock Exchange)
                       UUU - TSX Venture Exchange,
                       AIM (London Stock Exchange)
    

    TORONTO, ON, VANCOUVER, BC and JOHANNESBURG, South Africa Feb. 12 /CNW/ -
sxr Uranium One Inc. ("Uranium One") and UrAsia Energy Ltd. ("UrAsia") are
pleased to announce that the two companies have entered into a definitive
arrangement agreement whereby Uranium One will acquire all of the outstanding
common shares of UrAsia. The acquisition will result in the creation of a new,
globally diversified uranium producer with an exciting growth profile and a
combined fully-diluted market capitalization of approximately US$5 billion.
Subject to shareholder approval, the combined company will continue under the
name of Uranium One Inc.
    Under the terms of the acquisition, UrAsia shareholders will receive
0.45 common shares of Uranium One for each issued share of UrAsia,
representing a value of C$7.05 per share based upon the closing price of
Uranium One on the TSX on February 9, 2007. This represents a 13% premium to
the closing share price of UrAsia's shares on the TSX Venture Exchange on
February 9, 2007 and a 21% premium to the 20 day volume weighted average
trading prices of Uranium One's and UrAsia's shares on the TSX and TSX Venture
Exchange, respectively.
    The new Uranium One will be one of the world's largest uranium companies
ranked by market capitalization. The profile of Uranium One will be:

    
    -   Estimated combined attributable annual production in excess of
        7 million pounds U3O8 from five operations in 2008 (Dominion,
        Akdala, South Inkai, Kharassan and Honeymoon)

    -   Estimated cash operating costs of approximately US$10 to
        US$12 per pound U3O8 in steady state

    -   Un-hedged and un-capped sales contracts provide exposure to further
        uranium price increases on substantially all projected production

    -   Attributable proven and probable reserve base of 49 million pounds of
        U3O8, indicated resources of 102 million pounds of U3O8 and
        inferred resources of 269 million pounds of U3O8

    -   Substantial Russian P1 resources at South Inkai and Kharassan and
        upside potential at Dominion to drive organic resource growth

    -   A strong balance sheet with a pro forma cash balance of approximately
        US$389 million at December 31, 2006

    -   Industry leading expertise in both conventional and in situ leach
        (ISL) mining techniques
    

    Further detailed information on reserves and resources can be found in
the Additional Reserve and Resource Data section below and in the Other
Matters and Cautionary Statement at the end of this release.
    The transaction creates an emerging senior uranium company based on the
combined project pipeline. The new Uranium One will provide shareholders with
the benefits of scale through an increased market capitalization. The combined
entity will be the only company in the uranium sector with production and
asset exposure to each of the world's five largest resource jurisdictions,
namely Kazakhstan, South Africa, Australia, the United States and Canada.
    The Board of Directors of UrAsia has determined that the transaction is
in the best interest of UrAsia and its shareholders and that the exchange
ratio is fair to the UrAsia shareholders. The Board unanimously recommends
that holders of UrAsia shares vote in favour of the transaction.
    Paradigm Capital Inc. has provided a fairness opinion to the Board of
Directors of UrAsia that the consideration offered pursuant to the transaction
is fair, from a financial point of view, to the common shareholders of UrAsia.
    Senior officers and directors of UrAsia have agreed to vote in favour of
the transaction and lock-up as well as support agreements have been executed.
    Commenting on the transaction, Neal Froneman, Uranium One CEO said:
    "The combination of Uranium One and UrAsia creates a new, globally
diversified uranium company with compelling investment appeal. With imminent
production from Dominion in South Africa, combined with an established
production profile from the Akdala ISL mine, the new Uranium One will be an
exciting low-cost, growth-oriented uranium company, with five mines in
operation by Q1 2008. As a result of this acquisition, the competitive
advantages of the new Uranium One will be significant, as we will have the
technical and financial capabilities to pursue further value enhancing growth
opportunities, both organically and through further consolidation."
    Phillip Shirvington, CEO of UrAsia added:
    "The new Uranium One will be the pre-eminent growth company in the
sector, with an unrivalled production growth profile. The Company is well
positioned to gain maximum benefit from rising uranium prices. As a director
of the new Uranium One, I look forward to contributing to its continued
development and growth."

    Summary of the Transaction

    The business combination of Uranium One and UrAsia will be completed by
way of a statutory plan of arrangement under the Business Corporations Act
(British Columbia) whereby each UrAsia common share will be exchanged for
0.45 Uranium One common shares. After completion of the transaction, it is
expected that current Uranium One shareholders will own approximately 40% of
the combined company and current UrAsia shareholders will own approximately
60%.
    The combination has been unanimously approved by the Boards of Directors
of both Uranium One and UrAsia and will be subject to, among other things,
approval by a two-thirds majority of holders of UrAsia common shares and
regulatory approvals. A meeting of UrAsia shareholders to approve the
transaction will be held on or about May 15, 2007. The notice of meeting,
information circular and related materials is expected to be mailed in
mid-April, 2007.
    Paradigm Capital Inc. has provided an opinion to the Board of Directors
of UrAsia that the consideration offered pursuant to the transaction is fair,
from a financial point of view, to the common shareholders of UrAsia.
    The Board of Directors of Uranium One has determined that this
transaction is in the best interests of Uranium One shareholders and BMO
Capital Markets has provided an opinion to the Board of Directors of Uranium
One that the consideration offered pursuant to the arrangement is fair, from a
financial point of view, to Uranium One.
    If the transaction is not completed, UrAsia has agreed to pay a break fee
to Uranium One under certain circumstances of US$90 million. UrAsia has also
provided Uranium One with certain other customary rights, including a right to
match competing offers.
    As the new Uranium One will have a significant United Kingdom and
continental European shareholder base, the company will investigate all
available alternatives to facilitate continued liquidity for these
shareholders.

    Management Team and Board of Directors

    Neal Froneman will continue as President and Chief Executive Officer of
the combined company.
    The Board of Directors of the new Uranium One will ultimately consist of
nine members, comprising three nominees of UrAsia and six nominees of Uranium
One. Ian Telfer will be Non-Executive Chairman and Phillip Shirvington will be
one of the UrAsia nominees to the Uranium One Board. Frank Giustra resigned
from the Board of UrAsia effective February 11, 2007 in order to permit the
UrAsia Board to pursue this transaction without any perception of conflict, as
he is also Chairman of Endeavour Financial (UrAsia's financial advisor). Mr.
Giustra has confirmed to Uranium One and the UrAsia Board his continued
support for the transaction and will assist UrAsia, as financial advisor, to
bring the transaction to a timely and successful conclusion. Messrs. Telfer
and Shirvington and a third nominee from UrAsia will join Andrew Adams, Ken
Williamson, David Hodgson, Terry Rosenberg and Mark Wheatley as Non-Executive
Directors of the new Uranium One. At closing, the Board of Directors will be
comprised of eight members with the ninth member (one of the Uranium One
nominees), being nominated at the next AGM.

    Advisors and Counsel

    Uranium One's exclusive financial advisor is BMO Capital Markets and its
legal counsel is Fasken Martineau DuMoulin LLP. UrAsia's financial advisors
are Endeavour Financial International Corporation, Canaccord Adams Limited and
Paradigm Capital Inc. and its legal counsel is Stikeman Elliott LLP.

    Conference Call

    A conference call will be held on February 12, 2007 at 11:00 AM Eastern
time to discuss this transaction. A copy of the presentation is available on
www.uranium1.com.

    Via Telephone:
    The local dial-in number will be 416-340-2217. The North American toll
free dial-in will be 1-866-696-5910. International participants must dial
their international access code followed by 800-8989-6336. The passcode for
the live call is 3214593 followed by the number sign.
    A replay of the conference call will be available for one week at
416-695-5800 (local) or 1-800-408-3053 (North America toll free). The passcode
for the replay is 3214593 followed by the number sign.

    Via Webcast:
    A live audio webcast of the call will be available at
http://events.startcast.com/events/50/B0001

    Additional Reserve and Resource Data

    In conjunction with the following tables, readers are also urged to read
the Other Matters and Cautionary Statement at the end of this press release.

    UrAsia Energy Ltd.

    
    Proven Mineral Reserves

    -------------------------------------------------------------------------
      Asset        Tonnes     Grade Uranium  Contained U    Contained U3O8
                 (thousands)      (% U)      (tonnes U)      (million lbs)
    -------------------------------------------------------------------------
    Akdala(1)       2,769         0.057         1,590             4.1
    -------------------------------------------------------------------------
    (1)  Attributable


    Probable Mineral Reserves

    -------------------------------------------------------------------------
      Asset        Tonnes     Grade Uranium  Contained U    Contained U3O8
                 (thousands)      (% U)      (tonnes U)      (million lbs)
    -------------------------------------------------------------------------
    Akdala(1)       8,966         0.057         5,110            13.3
    -------------------------------------------------------------------------
    (1)  Attributable


    Indicated Mineral Resources(2,3)

    -------------------------------------------------------------------------
      Asset        Tonnes     Grade Uranium  Contained U    Contained U3O8
                 (thousands)      (% U)      (tonnes U)      (million lbs)
    -------------------------------------------------------------------------
    Akdala(1)      12,011         0.057         6,850            17.8
    -------------------------------------------------------------------------
    Kharassan(1)      791         0.201         1,590             4.1
    -------------------------------------------------------------------------
    (1)  Attributable
    (2)  Mineral resources are inclusive of mineral reserves
    (3)  Mineral resources are not mineral reserves and do not have
         demonstrated economic viability


    Inferred Mineral Resources(2)

    -------------------------------------------------------------------------
      Asset        Tonnes     Grade Uranium  Contained U    Contained U3O8
                 (thousands)      (% U)      (tonnes U)      (million lbs)
    -------------------------------------------------------------------------
    Akdala(1)       6,788         0.062         4,200            10.9
    -------------------------------------------------------------------------
    South Inkai(1) 40,390         0.043        16,720            43.5
    -------------------------------------------------------------------------
    Kharassan(1)    9,160         0.095         8,700            22.6
    -------------------------------------------------------------------------
    (1)  Attributable
    (2)  Mineral resources are not mineral reserves and do not have
         demonstrated economic viability


    Probable Mineral Reserves

    -------------------------------------------------------------------------
    Asset     Tonnes    U3O8 Grade Contained U3O8  Gold Grade  Contained Gold
            (thousands) (kg/tonne)   (thousands     (g/tonne)    (thousands
                                       of lbs)                     of ozs)
    -------------------------------------------------------------------------
    Dominion  18,454      0.77         31,327         0.99           589
    -------------------------------------------------------------------------


    Indicated Mineral Resources(1,2)

    -------------------------------------------------------------------------
    Asset     Tonnes    U3O8 Grade Contained U3O8  Gold Grade  Contained Gold
            (thousands) (kg/tonne)   (thousands     (g/tonne)    (thousands
                                       of lbs)                     of ozs)
    -------------------------------------------------------------------------
    Dominion  36,385      0.81         64,889         0.91         1,060
    -------------------------------------------------------------------------
    Dominion
     Dumps     3,375      0.16          1,195         0.51            55
    -------------------------------------------------------------------------
    Honeymoon  1,200      2.40          6,500          n/a           n/a
    -------------------------------------------------------------------------
    East
     Kalkaroo  1,200      0.74          2,000          n/a           n/a
    -------------------------------------------------------------------------
    Goulds
     Dam       1,700      1.20          4,400          n/a           n/a
    -------------------------------------------------------------------------
    (1)  Mineral resources are inclusive of mineral reserves
    (2)  Mineral resources are not mineral reserves and do not have
         demonstrated economic viability


    Inferred Mineral Resources(1)

    -------------------------------------------------------------------------
      Reef    Tonnes    U3O8 Grade Contained U3O8  Gold Grade  Contained Gold
      Unit  (thousands) (kg/tonne)   (thousands     (g/tonne)    (thousands
                                       of lbs)                     of ozs)
    -------------------------------------------------------------------------
    Dominion 219,375      0.38        183,630         0.67         4,752
    -------------------------------------------------------------------------
    Billeroo  12,000      0.30          7,900          n/a           n/a
    -------------------------------------------------------------------------
    (1)  Mineral resources are not mineral reserves and do not have
         demonstrated economic viability
    

    About Uranium One

    Uranium One Inc. is a Canadian uranium and gold resource company with a
primary listing on the Toronto Stock Exchange and a secondary listing on the
JSE Limited (the Johannesburg stock exchange). The Corporation owns the
Dominion Uranium Project in South Africa and the Honeymoon Uranium Project in
South Australia, and is actively pursuing growth opportunities in the uranium
sector in the United States. The Corporation holds an approximate 71.4%
interest in Aflease Gold Limited, which owns the Modder East Gold Project in
South Africa. Through a 50/50 joint venture with Pitchstone Exploration Ltd.,
the Corporation is also engaged in uranium exploration activities in the
Athabasca Basin of Saskatchewan.

    About UrAsia Energy

    UrAsia is a Canadian-based uranium producer that offers investors
exposure to low-cost uranium production and growth. The Company creates
shareholder value by focusing on the development and operation of low-cost,
in-situ leach uranium projects in Central Asia. UrAsia is listed on the TSX
Venture Exchange and the Alternative Investment Market (AIM) of the London
Stock Exchange, trading under the symbol UUU on both exchanges.

    Other Matters and Cautionary Statement

    Investors are advised to refer to independent technical reports on
Uranium One's material properties are available at www.sedar.com for detailed
information with respect to the Corporation's properties. Those technical
reports provide the date of each resource or reserve estimate, details of the
key assumptions, methods and parameters used in the estimates, details of
quality and grade or quality of each resource or reserve and a general
discussion of the extent to which the estimate may be materially affected by
any known environmental, permitting, legal, taxation, socio-political,
marketing, or other relevant issues. The technical reports also provide
information with respect to data verification in the estimation.
    This document uses the terms "measured", "indicated" and "inferred"
resources as defined in accordance with National Instrument 43-101 - Standards
of Disclosure for Mineral Projects. United States investors are advised that
while these terms are recognized and required by Canadian regulations, the SEC
does not recognize them. Investors are cautioned not to assume that all or any
part of the mineral deposits in these categories will ever be converted into
reserves. In addition, "inferred resources" have a great amount of uncertainty
as to their existence and economic and legal feasibility and it cannot be
assumed that all or any part of an inferred mineral resource will be ever be
upgraded to a higher category. Investors are cautioned not to assume that all
or any part of an inferred resource exists or is economically or legally
mineable. Mineral resources are not mineral reserves and do not have
demonstrated economic viability. Scientific and technical information
contained herein has been reviewed on behalf of Uranium One by Mr. M.H.G.
Heyns, Pr.Sci.Nat. (SACNASP), MSAIMM, MGSSA, Consulting Geologist or by Ms.
J.M. Smith, P.GEO Sr VP Corporate Development sxr Uranium One Inc.- both
qualified persons for the purposes of NI 43-101.
    Neither Uranium One nor Mr. Heyns or Ms. Smith have done sufficient work
to classify the historical estimates of UrAsia's P1 resources or Uranium One's
resources at Dominion as current mineral reserves or resources. Uranium One
does not intend to treat such historical estimates of reserves and resources
as a current estimate and the historical estimates should not be relied upon.
    Scientific and technical information contained herein has been reviewed
on behalf of UrAsia by C. Stewart Wallis, P.Geo. Consulting Geologist - a
Qualified Person for the purpose of NI 43-101. Technical Reports prepared by
Scott Wilson RPA (formerly Roscoe Postle Associates Inc.) in accordance with
NI 43-101. Kharassan Technical Report, dated October 13, 2005, as revised
March 25, 2006; South Inkai Technical Report, October 8, as revised March 20,
2006; and Akdala Technical Report, dated October 3, 2005 as revised March 3,
2006. The Technical Reports are available at www.sedar.com.
    Historical estimates referred to herein as Russian P1 resources are
derived from Kazatomprom documents, an entity of the Government of Kazakhstan.
Although Russian P1 Resources do not meet Canadian Institute of Mining,
Metallurgy and Petroleum (CIM) standards on Mineral Resource and Reserve
definitions, they are considered relevant because of previous pilot plant
production, but should not be relied upon. The CIM resource definition which
most closely resembles P1 resources is that of Inferred Resources. However,
there is less confidence attributed to a P1 resource since a P1 resource is
estimated on the basis of a lower drill density than an inferred resource.

    No stock exchange, securities commission or other regulatory authority
has approved or disapproved the information contained herein.

    Forward-looking statements: Certain of the statements made herein,
including any information as to the Corporation's future financial or
operating performance, may be forward-looking and subject to important risk
factors and uncertainties, many of which are beyond the Corporation's ability
to control or predict. Forward-looking statements are necessarily based on a
number of estimates and assumptions that are inherently subject to significant
business, economic and competitive uncertainties and contingencies. Known and
unknown factors could cause actual results to differ materially from those
projected in the forward-looking statements. Such factors include, among
others: gold and uranium price volatility; impact of any hedging activities,
including margin limits and margin calls; discrepancies between actual and
estimated production, between actual and estimated reserves and resources and
between actual and estimated metallurgical recoveries; changes in national and
local government legislation, taxation, controls, regulations and political or
economic developments in Canada, the United States, South Africa, Australia or
other countries in which the Corporation does or may carry on business in the
future; risks of sovereign investment; the speculative nature of gold and
uranium exploration and development, including the risks of obtaining
necessary licenses and permits; dilution; competition; loss of key employees;
additional funding requirements; and defective title to mineral claims or
property. In addition, there are risks and hazards associated with the
business of gold and uranium exploration, development and mining, including
environmental hazards, industrial accidents, unusual or unexpected formations,
pressures, cave-ins, flooding and gold bullion losses (and the risk of
inadequate insurance or inability to obtain insurance, to cover these risks),
as well as the factors described or referred to in reports filed by the
Corporation with the Canadian securities administrators. Accordingly, readers
should not place undue reliance on forward-looking statements. The Corporation
undertakes no obligation to update publicly or release any revisions to
forward-looking statements to reflect events or circumstances after the date
of this document or to reflect the occurrence of unanticipated events.

    %SEDAR: 00005203E




For further information:

For further information: Neal Froneman, Chief Executive Officer, sxr
Uranium One Inc., Tel: (416) 350-3657; Jean Nortier, Chief Financial Officer,
sxr Uranium One Inc., Tel: + 27 11 482 3605; Chris Sattler, Vice President,
Investor Relations, sxr Uranium One Inc., Tel: (416) 350-3657; Phillip
Shirvington, Chief Executive Officer, UrAsia Energy Ltd., Tel: (604) 609-5130;
Sally Eyre, Vice President, Corporate Affairs, UrAsia Energy Ltd., Tel: (604)
377-2757; Ben Willey, Buchanan Communications, Tel: + 44 (0)207 466 5118; sxr
Uranium One Inc., 390 Bay Street, Suite 1610, Toronto, Ontario, M5H 2Y2;
UrAsia Energy Ltd., Suite 3123, 595 Burrard Street, Vancouver, British
Columbia, V7X 1J1; For further information about Uranium One or UrAsia, please
visit www.uranium1.com or www.urasiaenergy.com

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