Mega Uranium has signed an agreement to merge with Rockgate Capital in order to create a diversified uranium company with advanced uranium assets in Australia and Mali, a pro forma cash balance of about $22m, and a uranium-focused investment portfolio valued at about $12m.
As per the terms of the merger, Rockgate shareholders will receive 2.2 Mega Shares for an each common share of Rockgate held.
Once the merger is completed, Rockgate and Mega shareholders will own approximately 49% and 51% of the combined uranium company, respectively.
Mega Uranium chairman and chief executive officer Sheldon Inwentash said, "This transaction represents the opportunity to combine one of Africa’s most promising undeveloped uranium assets with our significant Australian portfolio, to create an international uranium developer."
The merger is anticipated to be completed by way of a three-cornered amalgamation, or a plan of arrangement, which will result in Rockgate becoming a wholly-owned subsidiary of Mega.
Subject to the execution of the definitive agreement and satisfaction of all closing conditions, the transaction is expected to be completed in September 2013.