UPDATE 2-China’s CNNC to buy Khan Resources for C$56.5 mln

* Offer price at C$0.96/shr

* Offer at premium of 12 pct to co’s Friday close

* Shares up as much as 16 pct
(Recasts, adds details and share movement)

Feb 1 (BestGrowthStock) – Canada’s Khan Resources Inc (KRI.TO: )
agreed to be bought by Beijing-based CNNC Overseas Uranium
Holding Ltd in a deal that values the uranium explorer at
C$56.5 million ($52.9 million) and gives the Chinese firm
access to the Dornod field in Mongolia.

Khan Resources said CNNC, a subsidiary of China National
Nuclear Corp, will pay 96 Canadian cents per share, which
represents a 12 percent premium to Khan Resources closing price
on Friday.

Khan Resources, which holds a 58 percent stake in Dornod,
has been looking to renew its licenses for the project,
following the Mongolian government’s decision to regulate
uranium mining.

Dornod has uranium reserves of about 22,000 tons and this
amount could be significantly increased with further
exploration.

Mongolia’s uranium deposits are currently ranked 15th in
the world, but are attracting increasing attention as climate
change concerns and China’s rapid growth spur construction of
nuclear power plants worldwide.

In December, Khan Resources had rejected an offer of 65
Canadian cents a share from Russian state uranium miner ARMZ,
or AtomRedMetZoloto, which owns a 21 percent stake in Dornod.
[ID:nGEE5AT12O]

The company said CNNC has the right to match any superior
offer made by another bidder and will be paid a termination fee
of C$1.6 million if the deal falls through in certain
circumstances.

Khan Resources shares, which have surged about 213 percent
in the last three months, were up 14 Canadian cents Monday
morning on the Toronto Stock Exchange. They touched a 52-week
high of C$1 earlier in the session.
($1=1.069 Canadian dollar)

Growth Stocks
(Reporting by R. Manikandan in Bangalore; Editing by Aradhana
Aravindan)

UPDATE 2-China’s CNNC to buy Khan Resources for C$56.5 mln