Alexander Ignatyuk, an analyst of Energokapital IG:

 — On the other hand, Uranium One’s strategy of mining extension is excellently harmonizing with the growing demand for uranium raw material on the part of the Russian and foreign projects of Rosatom.

The Board of Directors of Uranium One Inc. approved the advice for the shareholders to acquire 50% share of Akbastau uranium mine and 49.67% share of Zarechnoye mine from Atomredmetzoloto OJSC (ARMZ). In addition, ARMZ will pay USD 610 mln. At least USD 498 mln of them will be paid directly to the shareholders (all of them, except for ARMZ) as a bonus for control after closing in the form of a special dividend in the amount not less than USD 1.06 per Uranium One share. Under the transaction terms, ARMZ will get 365 mln of new issued ordinary shares of Uranium One.

Making the decision the Board of Directors of Uranium One took into account, in particular, recommendations of the special committee of independent directors established to evaluate the transaction; the official valuation of assets prepared by independent financial adviser of CIBC World Markets Inc (CIBC) special committee, as well as report on transaction terms justice prepared by a company adviser and CIBC BMO Capital Markets. According to CIBS evaluation, the cost of assets is from USD 815 mln up to USD 1 bln. According to CIBS the average cost amounts to USD 907.5 mln. The transaction shall be approved by the Uranium One shareholders, including majority vote of minority shareholders at the extraordinary shareholders’ meeting on August 31st in Vancouver (British Columbia). The transaction which requires approval of the regulatory authorities of Kazakhstan and other countries as well as performance of other standard terms of the closing is to be closed till the end of 2010. Also, Uranium One reported that the transaction had received all necessary formal corporate approvals from ARMZ. “We have carried out a complete inspection which confirmed the high quality of Akbastau and Zarechnoye mines,”- chief executive officer of Uranium One Zhan Nortye said. He added that after closing Uranium One would become one of the largest uranium suppliers in the world with low production cost. General Director of ARMZ Vadim Zhivov noted that this transaction would improve Uranium One’s position as a leading supplier of uranium. “We fully support Uranium One in implementation of their growth strategy. In our opinion, it will bring profit to all shareholders of the company,” – Zhivov said.

Alexander Ignatyuk, an analyst of Energokapital IG:

«The transaction consisted in acquisition of control over Uranium One Canadian holding by Atomredmetzoloto is an important component of strategy of Russian nuclear power industry development and extension of the international presence of the Russian nuclear power industry abroad. On the other hand, Uranium One’s strategy of mining extension is excellently harmonizing with the growing demand for uranium raw material on the part of the Russian and foreign projects of Rosatom. Thus, acquisition of control over one of the largest world producer of raw material for the nuclear fuel will provide the opportunity to ensure promptness of supplying of required uranium volumes.

Moreover, this transaction will allow providing for territorial diversification. It is critical for extension of the international geography of Russian NPP construction and their further operation. Business publicity and openness which are the base of Uranium One and Rosatom activity will contribute to ultimate trust on the part of the international partners to the activity of the largest Russian nuclear power developer”.