South African investor Mandla 'Bear' Kumalo said he offered to
buy a stake of 26% in Canada's First Uranium Corp. (FIU.TO) in an
effort to block the sale of a mine to Australia's Gold One
International Ltd., Bloomberg reported.
Kumvest (Pty) Ltd., Kumalo's wholly owned investment company,
would acquire new shares of First Uranium for 37 Canadian cents
apiece, he said today in a telephone interview from Johannesburg.
The offer is more than double First Uranium's closing share price
in Toronto yesterday.
Bloomberg noted First Uranium shares have plunged 99% in the
past five years after uranium prices dropped and its South African
operations faced delays. The Toronto-based company is selling
assets for $405 million to help pay off debt, including about C$150
million ($146 million) due June 30.
No one answered calls to First Uranium's offices in Toronto and
Johannesburg. Mary Batoff, a company spokeswoman, didn't
immediately respond to an e-mail seeking comment.
Kumalo said he has submitted his proposal to First Uranium. The
transaction is conditional on the company appointing a new chief
executive officer, financial director and chief operations officer.
Kumalo is also seeking the new management be given 90 days to
present a turnaround plan.
Kumalo said he wants to stop First Uranium's agreed sale of its
Ezulwini gold and uranium mine to Gold One for $70 million. The
company is also selling its Mine Waste Solutions unit to
Johannesburg-based AngloGold Ashanti Ltd. (ANG) for $335
"Management has done a bad job," Kumalo said. "The board doesn't
have to sell all the assets."
First Uranium has scheduled a June 13 shareholder vote on the
The Kumvest deal would also enable First Uranium to satisfy
South Africa's black empowerment regulations that compels all mine
operators in the country to sell 26% of their assets to black