By Agnetta Okwemba/Alloys Musyoka
It is a done deal after the Compensation Authority of Kenya approved the acquisition of Kwale Titanium’s parent company, Base Titanium limited by EFR Australian PTY limited.
The acquisition process started last year as the company began plans to fold as its mining life comes to an end in December.
Already workers whose contract expired have been sent parking with guidance and counseling sessions for staff due to leave the company going on.
Base titanium has been mining in Kwale since 2013 while exporting Rutile, Ilmenite and Zircon minerals.
According to the statement issued by CAK , EFR Australia PTY Limited will take over operation in Kenya a few months before the closure of operation by Base Titanium in the deal.
EFR Australia PTY Limited is an Australian-based company that is wholly owned by Energy Fuels Inc. (EFI), a firm registered in Canada.
TEFI is a mining development and production company that engages in the exploration, evaluation, development, and mining/production of uranium, vanadium, and rare earth element properties.
According to CAK the proposed transaction involves the acquisition of 100% of the issued and outstanding shares in the capital of Base Resources Limited by way of a scheme of arrangement in exchange for shares in the capital of Energy Fuels Inc.
“According to the parties, the rationale for the transaction is diversification of EFR PTY’s mining business,” CAK said in a statement.
The transaction qualified as a merger within the meaning of sections 2 and 41 of the Competition Act CAP 504 according to the CAK statement.
“The Competition Act stipulates that a merger, or takeover, may occur when an undertaking directly or indirectly acquires control over another business within Kenya.” Added CAK.
It added that such may happen through, among others, purchase/lease of shares, exchange of shares, vertical integration.
Recently Base Resources Limited, an Australian firm that owns Base Titanium Limited in Kwale, informed the shareholders that they will get 0.026 of Energy Fuels common shares after the transaction.
CAK said that one criterion of assessing a merger’s impact on competition is the post-merger market share of the undertakings involved in the transaction.
Post-merger, the merged entity’s market share will not change since the target and the acquiring group do not operate in Kenya.
They said that the proposed transaction will not affect the structure and concentration of the market for Page 3 of 3 titanium minerals in Kenya.
“Therefore, the proposed transaction is unlikely to lead to a substantial lessening of competition in the market for titanium minerals in Kenya,” added CAK.
Base Titanium’s request to do mining exploration in Tana River and Lamu was Okayed with residents being invited to give views over the same to the ministry of mining.
