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The deal will see Uranio issue 50 million shares to Coal of Africa in exchange for Coal of Madagascar, a subsidiary of Coal of Africa.
The Madagascan play has $US1.3 million cash which will pass to Uranio, along with exploration licences over the Imalotoo coal field in the highly prospective Sakoa Basin.
Another $A1 million is coming from Uranio shareholder Manhattan Resources, which has agreed to subscribe to 14 million Uranio shares at 7c each.
The deal is conditional on shareholder approval but this morning Uranio managing director Rob Wrixon told ILN sister publication MiningNews.net the company was “delighted” with the deal, especially given market conditions.
He said under the terms of the agreement Uranio was nabbing the tenements for $4.5 million worth of Uranio shares, not counting the cash part of the acquisition.
Coal of Africa has drill rigs onsite and will continue working on the project for around 6000m or $US1 million worth of drilling, Wrixon said.
After the deal Coal of Africa will own nearly 39% of Uranio but existing Uranio shareholders will still hold the majority of the Perth-based play.
The deal is subject to shareholder approval.
Shares in Uranio were unchanged at 9c while shares in Coal of Africa were also steady at 85c.
