It is easy to see why Extract Resources is about to be taken over……
“EXTRACT Resources has suspended trading in its shares after the price soared on speculation China’s Guangdong Nuclear Power is set to launch a bid for the Perth-based uranium company.
State-backed Guangdong has reopened talks with Kalahari, Extract’s 42.7 per cent shareholder, in a move expected to result in a $2.2 billion offer for Extract.
A £675 million ($1.07bn) takeover deal for Kalahari could be concluded as early as this week, according to a report in London’s Sunday Times.
Shares in Extract surged on open today following the bid speculation, with the stock gaining 10.2 per cent to reach $8.86 before trading was halted.
Extract said the request for the trading halt was to respond to the media speculation and it requested the halt remained in place until Wednesday.
Under Australian takeover laws, if Guangdong acquires Kalahari, it will have to bid for Extract because it will acquire more than 20 per cent of the Australian company.” read the full report
Does size matter?