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TORONTO – Mining tycoon Lukas Lundin has joined an effort to convince Fission Uranium Corp.’s skeptical retail shareholders that they should approve a friendly merger with Denison Mines Corp.
The shareholder vote is scheduled for Oct. 14, and executives at both companies acknowledged on Tuesday they do not know which way Fission’s investors will go. The vast majority of the stock is held by retail shareholders, some of whom are loudly resisting the deal with Denison, one of Lundin’s companies.
As a result, Lundin himself is speaking with retail investors in Toronto this week to make the case for the $280-million, all-stock deal. For him, the argument is pretty simple.
“We’re trying to become the go-to name in the industry,” he said in an interview. “When uranium moves up again, we should move quite strongly because there’s nowhere else (for investors) to go. You have Cameco (Corp.) and Denison.”
Fission chief executive Dev Randhawa said he appreciates that retail investors would prefer a monster takeover offer from Cameco or Areva to this smaller deal with Denison. But he thinks they are ignoring one simple fact: there is no such deal out there.
Most of the big uranium deals of the past decade turned out to be disasters for the buyers. And in this depressed market, which is still reeling from the Fukushima nuclear disaster in 2011, Randhawa said no buyer wants to repeat that mistake.
“If there was a sweetheart deal out there, we would have done it,” he said. “But there isn’t, because we’re paying for the sins of the previous deals in our industry.”
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