Camec in £100m bid for Australian uranium miner

Camec, the African-mining group run by the former England spin bowler Phil Edmonds, has targeted expansion in the booming market for uranium after launching an offer for OmegaCorp that values the Australian miner at nearly £100m.

Uranium prices have surged 20 per cent to $113 a pound over the past week, the highest level since the 1970s. Prices have soared from around $10 a pound less than five years ago as a result of supplies of raw uranium remaining static. Analysts expect prices will continue to rise as government interest in nuclear energy in countries such as the US and the UK continues to gather pace.

Camec, or Central African Mining & Exploration Co, is keen to add uranium to its product portfolio. The company currently mines bauxite, cobalt, coal, copper and gold across a number of sites in southern Africa. It has recently discovered uranium deposits that could prove significant at one of its sites in the Democratic Republic of the Congo, but otherwise has no exposure to the element.

The company has made an all-share bid for OmegaCorp that values the company at A$222m. The offer trumps an earlier bid from the Canadian uranium miner Denison Mines that was agreed in March. Denison Mines raised its all-cash offer to A$1.15 last month and said that it was the company's final offer.

Camec's bid represents a 25 per cent premium to the rival offer and the AIM-listed company has already received acceptances from almost 20 per cent of the Australian company's shareholders. However Denison owns 31.5 per cent of OmegaCorp's shares and could be a major stumbling block to Camec completing the deal. Camec is yet to hold talks with Denison a spokesman said.

OmegaCorp has projects in Zambia, Tanzania, Mozambique and Zimbabwe. Camec, which operates the largest logistics fleet in southern Africa, said its experience in markets like Mali, Mozambique and South Africa combined with its access to international capital markets would drive a rapid expansion of OmegaCorp's uranium portfolio with the aim of rapidly developing a producing entity.

Andrew Groves, the chief executive of Camec, said: "OmegaCorp's portfolio of highly prospective uranium targets ... should enable us to create a regionally focused uranium division that will expand our resource exposure and provide the enlarged company with a foundation to expand in this area."

Mr Edmonds, who also runs the London-listed oil miner White Nile, is chairman of the company.

Camec's entry into the uranium market follows a number of other deals as mining companies look to increase exposure to the element. Areva, a French nuclear company, purchase a 9 per cent stake in Australia's Summit Resources which is also being bid for by Paladin Resources, while Japan's Mitsubishi has invested in a 50 per cent stake in the CanAlaska mining project.