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European Uranium to sell Slovakia uranium projects to Forte Energy

Published: 14:35 04 Apr 2014 EDT

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European Uranium Resources (CVE:EUU) said it has agreed to sell its Kuriskova and Novoveska Huta uranium projects in Slovakia to Australia's Forte Energy NL (ASX:FTE) (LON:FTE) for approximately $8.5 million plus a production royalty. The deal represents the sale of the company's only remaining mineral projects. 

It told investors in a statement Friday that it now plans to investigate mineral projects to option or acquire in "multiple commodities" in Europe, with the deal today giving the company the initial funding to implement its business strategy.

The binding heads of agreement with Forte, a dual-listed exploration and development company with a portfolio of uranium assets in the Republics of Mauritania and Guinea, is subject to regulatory and shareholder approvals of both companies.

Under the terms of the deal, Forte will issue 854.88 million fully paid ordinary shares worth about $7 million, which the company plans to distribute on a pro-rata basis to shareholders. Forte will also issue 61.06 million shares to the company, worth roughly $0.5 million, and will also pay European Uranium $1.0 million on closing. 

In addition, European Uranium will have a 1% production royalty over its projects. 

European Uranium said the sale price of $8.5 million represents a premium of nearly 35% to its market cap of $6.3 million at the time its shares were halted in December.

The company noted Friday that it is currently negotiating with the TSX Venture Exchange on the timing to resume trading.

Separately, European Uranium has agree to complete an exclusive, non-brokered private placement with Forte to raise $100,000 through the issue of 1.11 million units at a price of 9 cents apiece. 

French nuclear energy giant Areva currently holds a 4.5% stake in Forte. 

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