Shares digital

A metals exploration project in Namibia has become the centre of attention for two Aim-listed resource companies seeking participation in a potential world-class uranium deposit. Niger Uranium (URU:AIM) has paid £10 million for a 17.8% stake in Kalahari Minerals (KAH:AIM), which in turn owns 36.2% of Extract Resources – the owner of the Namibian uranium assets.

Niger Uranium is understood to have made the investment in Kalahari to aid discussions in taking a direct stake in Extract. Kalahari last week raised £14.4 million to ensure it had spare cash ready to take part in an anticipated share placing in Extract, which needs funds to advance uranium exploration. Kalahari said it would invest to maintain its current stake, but rival interest from Niger Uranium could prompt it to raise its holding further to sustain the upper hand.

Kalahari last year merged its uranium assets in Namibia with Extract in exchange for a stake in the ASX-listed corporate vehicle. Subsequent drilling has shown promising uranium grades and attracted institutional interest as the project is located next to Rossing, Rio Tinto’s (RIO) famous uranium mine.

Shares says: There is a risk that Niger and Kalahari get distracted from existing interests, but both are worth a punt - the former on strong management and the latter on interesting copper and zinc assets.

BUY Kalahari Minerals, Niger Uranium

by: Dan Coatsworth