Energy Metals recommends Chinese bid

West Perth-based Energy Metals has recommended shareholders accept a proportional takeover bid by China Uranium Development Company.

Under the offer, the Chinese entity, which is owned by the China Guandong Nuclear Power Holding Co, is offering $1.02 cash for each Energy Metals share for 70 per cent of the shares held by each shareholder.

In addition, CUDC has agreed to underwrite an $11.7 million rights issue.

Energy Metals said shareholders should accept the offer because it was priced at a 'strong' premium and investors would retain exposure to the company's assets.

The company added that its funding requirements will be met, risks associated with the Bigrlyi uranium project near Alice Springs would be reduced and it would have a strategic relationship with a nuclear power end-user.

Shares in Energy Metals closed up 0.5 cents to 92c today.