Shares digital

Investors in copper producer Nikanor (NKR:AIM) will not immediately be able to trade their stock on UK markets once it merges with fellow DR Congo miner Katanga. The merger, approved last week by Katanga shareholders, will see Nikanor investors get 0.613 new Katanga shares and $2.16 cash per Nikanor share.

Nikanor’s Aim-quoted stock will be delisted on 11 February. Shares in the enlarged group will then start to trade only on the Toronto Stock Exchange, where Katanga already has a listing. Katanga said last November that the enlarged group would also secure a listing on the main market of the London Stock Exchange within five months of the merger completing.

Details on this transaction were notably absent on the merger update following last week’s shareholder meetings. A spokesperson for Nikanor merely reiterated the company’s original statement on the LSE plans, but could not provide details on whether UK shareholders would be able to automatically transfer their TSX shares to LSE-listed stock once the additional primary listing was secured. Katanga is forecast to be the world’s biggest cobalt producer and fourth largest copper producer by 2013.

Shares says: It will be a small hassle but most stockbrokers should be able to sell investor’s TSX-listed Katanga stake if required. But long-term prospects suggest the merged group could be an attractive investment to tuck away.

by: Dan Coatsworth