12/10/2009 - 12:11

Epsilon boost from South American buy

12/10/2009 - 12:11

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Epsilon Energy has entered into a binding deal to acquire the outstanding shares in private Canadian outfit Takatu Minerals, which holds prospective gold and uranium projects in South America, in an all-scrip deal valued at more than $9 million.

Epsilon boost from South American buy

Epsilon Energy has entered into a binding deal to acquire the outstanding shares in private Canadian outfit Takatu Minerals, which holds prospective gold and uranium projects in South America, in an all-scrip deal valued at more than $9 million.

News of the acquisition prompted Epsilon shares to double in value in early trade today, reaching a high of 10 cents, before easing to nine cents at 14:36 AEST.

Under the deal, the Epsilon will issue 106.8 million shares to Takatu's shareholders, and a further $US150,000 worth of Epsilon shares to satisfy the West Omai gold project obligations.

Based on Epsilon's last traded price of nine cents, the deal is valued at about $9.8 million, not including facilitation and lawyer fees.

The deal is subject to due diligence and a capital raising of at least $3 million.

At the end of the transaction and equity raising, Takatu's vendors will hold about 46 per cent of Epsilon.

Should the deal move ahead, Epsilon will welcome Takatu's Dominic O'Sullivan as an executive director of the company.

Takatu's holdings in Guyana, South America, include the Amakura uranium project and the West Omai and the East Omai gold projects.

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