Shareholders of CIC Energy, the developers of the ambitious energy complex in the central district of Botswana, on Friday voted in favour of the acquisition of the company by an Indian giantÔÇö JSW Energy Limited.
The company had recommended to shareholders to vote for the acquisition, which is via a merger and will see the Virgin Islands based coal rich outfit delisting from the Toronto Stock Exchange (TSX) and the Botswana Stock Exchange (BSE).
“….the proposed acquisition of CIC Energy by JSW Energy Limited (“JSW”) was approved by approximately 99.8 percent of the votes cast at the special meeting of shareholders held earlier today (Friday),” the company told shareholders.
Upon the completion of the merger, the holders of the outstanding shares of CIC Energy, including any shares issued pursuant to the exercise of outstanding options, will receive CDN$7.42 per share.
“This price represents a premium of 203 percent to the volume weighted average trading price for CIC Energy’s shares on the TSX for the 30-trading day period ending September 14, 2010, the day prior to the announcement of the first proposal CIC Energy received with respect to the acquisition of the Company,” it added.
The wording of the acquisition was changed in December from take-over to merger therefore changing the legal structure of the deal.
The move was to be sanctioned by a special meeting of shareholders to consider and approve the merger.
The agreement, which was supported by the company’s board, was also subject to the resolution approving the merger being passed by a majority of the votes cast at the meeting, holders of not more than 5 percent of the issued and outstanding CIC Energy shares having exercised their dissent rights in respect of the merger and the Meeting having been held on or before January 24, 2011.
JSW Energy in October agreed to buy CIC Energy for C$7,42 a share in cash, in a transaction that has the support of the coal rich Virgin Islands based company.
India is very hungry for coal to fire up its development and the conglomerate might be looking at Botswana coal as another source.
Botswana has unmined coal resources of around 2 billion metric tonnes, which, if mined at the current rate, should have a life-span of 15,000 years.
The company has 52.6 million common shares outstanding and 70 million common shares fully diluted, including vesting of options and warrants.
The merger is expected to close no later than February 28, 2011, subject to the satisfaction or waiver by JSW of certain conditions precedent.