UraMin


UraMin is a Canadian company involved in uranium mining exploration, listed on the Toronto Stock Exchange since December 2006, and acquired by the French multinational Areva on June 15, 2007, for 1.8 billion euros, to secure its uranium supply.
In 2006, the price of nuclear fuel rose sharply. Over the winter, Uramin buys uranium deposits in Africa, but in 2008 these proved to be inoperable. This contributed to Areva's difficulties, as it found itself short of fuel for its customers, especially as the price of uranium finally fell in 2011, causing Uramin to lose all its value.
Areva's 2007 takeover bid for Uramin marked the beginning of the "UraMin affair". The press revealed this politico-financial scandal involving French, Canadian, and African entrepreneurs and politicians in the early 2010s. The intelligence services, the French National Assembly, the Cour des Comptes, and the French justice system investigated various aspects of the case. Gradually, revelations of espionage, corruption, fraud, and conflicts of interest accumulated in the press.
Including losses, Uramin cost Areva over 3 billion euros. Areva CEO Anne Lauvergeon was dismissed in 2011.

History

2005: Creation of ''Uramin Inc.''

On December 20, 2004, the French company "Cogema Développement 1" was created, to become the holding company Uramin Holding.
On February 25, 2005, Uramin Inc. was incorporated in the British Virgin Islands. Uramin was created by Stephen Dattels and James Mellon, owners of uranium deposits in Africa listed on the London and Toronto markets. Stephen Dattels is one of the founders of mining company Barrick Gold. The Quebec newspaper La Presse traced him to two other stock market operations that went awry. James Mellon, co-founder of Uramin, had already been prosecuted by financial prosecutors in South Korea.
In May 2005, Stephen Dattels and his associates secured the rights to Trekkopje by purchasing Gulf Western Trading Namibia from businessman George Christodoulou for $4.365 million. Thousands of American investors, including stars Elvis Presley, Johnny Carson and Alice Cooper, believe they were cheated in an allegedly fraudulent project by Christodoulou in Namibia in the late 1970s.
In October 2005, Stephen Dattels acquired 6,000 ha around the Ryst Kuil deposit in South Africa for $1 million.

2006: IPO">Initial public offering">IPO and speculation

Uramin was floated on the high-risk London Stock Exchange in April 2006.
In May 2006, Uramin acquired three new mining licenses for $27 million a few kilometers north of Bakouma in the Central African Republic.
In 2006, Olivier Fric, a consultant specializing in energy issues and Anne Lauvergeon's husband, passed on the curriculum vitae of Belgian financier Daniel Wouters, who was subsequently hired in April by Areva as head of development and acquisitions for its mining division to act as an intermediary in the takeover of Canadian company UraMin. According to the daily newspaper Libération, Daniel Wouters is financially linked to Uramin shareholders Mellon and Dattels.
Estimates of Uramin's deposits were initially carried out by SRK Consulting, a consulting firm commissioned by UraMin to audit its reserves.
On October 17, 2006, Uramin proposed to Areva CEO Anne Lauvergeon that it be bought out for $471 million. However, Mrs. Lauvergeon did not immediately respond to this offer. At the end of October, Mrs. Lauvergeon received a letter from Samuel Jonah, chairman of the Board of Directors of UraMin, putting an end to the discussions and suggesting that she contact him again in early 2007.
On October 22, 2006, in Canada, the Cigar Lake mine flooded for the second time in a row, for the same reasons that the McArthur uranium mine13 had been blocked for six months in April 2003: the artificial protective ice wall was not enough to block the moisture coming from underground. Uranium prices soared.
In December 2006, eight months after listing on the London Stock Exchange, Uramin was listed on the Toronto Stock Exchange.

2007: acquisition of UraMin

Following the IPO in December 2006, Uramin's share price was the subject of intense speculation in the spring of 2007. The reason for this was a flurry of promises and declarations by the two owners. In just a few months, the share price tripled.
In 2007, the spot price of uranium hit an all-time high due to a "uranium shortage that could hit nuclear power plants in the next thirty to forty years", but quickly fell below $100 after the acquisition of UraMin in the summer of 2007, then below $50 following the Fukushima nuclear accident in March 2011.
UraMin, a young Canadian start-up in 2007, had never mined uranium before. Its assets consisted of projects, many of which had been identified by French entities that were gradually merged into Areva.
UraMin's properties are located in 5 African countries:
These projects had been abandoned by their inventors, who considered them unprofitable. URAMIN was able to add these assets to its portfolio at a very low cost. However, the company was acquired by the Areva group in the summer of 2007 at a very high price.
In March 2007, Areva first announced the purchase of 5.5% of Uramin's capital, causing the share price to soar, before buying the entire company three months later for $2.5 billion.
On May 2, 2007, between the two rounds of the 2007 presidential election, Areva executives reached an agreement in London with the sellers of Uramin to set the timetable for the takeover bid. The decision was taken under the authority of Anne Lauvergeon, with the a priori approval of the Agence des participations de l'État, and at a time when Luc Oursel was already present on the Management Board, which he joined in January 2007. On June 15, Areva announced that the purchase had been completed for $2.5 billion.
Areva had been prevented from acquiring the Australian giant Olympic Dam and had been unable to acquire Summit Resources, but the deal went ahead. It was carried out with relative urgency, Areva arguing that "UraMin has set May 31, 2007 as the deadline for a transaction to purchase its shares"; on June 15, 2007, "Areva announced a tender offer for Uramin based on a price of US$7.7 per share, representing an attractive premium excluding dividends of 21% over the 20-day weighted average share price as of June 8, 2007. Areva's press release states that UraMin's Board of Directors considered the offer "to be in the best interests of shareholders". The price paid by Areva was therefore around ten times higher than UraMin's share price six months earlier.
On January 2, 2008, Sébastien de Montessus became Chairman of Uramin Holding, a société par actions simplifiée based on rue La Fayette, as well as Director of the Areva Group's Mining Business Unit.

2008: Areva's first difficulties

In 2008, Areva's partner China Guangdong Nuclear Power Company was due to buy 49% of UraMin, but this never happened. However, CGNPC is said to have made direct access to uranium supplies a condition of the purchase of the EPR reactors.
Until March 2008, no Areva employees were allowed to visit Uramin sites in the Central African Republic, which was contesting the acquisition of Uramin's local subsidiary, Uramin CAR. The Central African Republic demanded 250 million euros from Areva for access to the deposit. This is why, in April 2008, Belgian entrepreneur George Forrest and Patrick Balkany, deputy mayor of Levallois-Perret, acted as intermediaries in Areva's purchase of UraMin's Central African uranium mines. On August 1, 2008, Anne Lauvergeon signed an amendment to the Bakouma mining concession contract, committing the company to pay forty million dollars to the Central African state.

2009: French secret service investigation

According to geopolitical expert Vincent Crouzet, the Direction Centrale du Renseignement Intérieur began investigating the Uramin case as early as 2009, interviewing Pakistani businessman Saïfee Durbar, who had been asked by Central African President François Bozizé to look into the Uramin affair.
On October 28, 2009, Vincent Crouzet met with Saïfee Durbar at his home in London and spoke at length with him about the Uramin affair.

2010: launch of a government audit

In February 2010, Admiral Thierry d'Arbonneau, Areva's Director of Safety, recruited Marc Eichinger, a business intelligence expert with the consulting firm Assistance Petroleum International Capital, to investigate the Uramin takeover. The investigation report was delivered on April 10, 2010, to the office of Areva's safety director, and concluded that the deal was "highly dubious and potentially fraudulent".
In April 2010, the French state shareholder was alarmed and appointed René Ricol to chair the audit committee of Areva's supervisory board, and to clarify accounts deemed lacking in transparency, notably concerning the recent acquisition of UraMin. He "made provisions of 426 million euros in 2010 for UraMin uranium quantities, and included a paragraph in the notes to the annual financial statements referring to chemical tests that were not very good".
On April 16, 2010, Anne Lauvergeon and Hage Geingob, Minister of Trade and Industry of the Republic of Namibia, inaugurated Namibia's first seawater desalination plant, located near the Trekkopje site. Designed to supply water to Areva's future mine, the plant cost $250 million to build.

2011: French parliamentary audit and suspension of projects in Africa

On February 2, 2011, Sébastien de Montessus met with Swiss detective Mario Brero at the Kempinski Hotel in Geneva to commission him to investigate the Uramin takeover, and in particular Anne Lauvergeon and her husband Olivier Fric.
On April 23, 2011, Paris Match revealed that "the African deposits of subsidiary UraMin have still not produced a single gram of uranium".
On June 21, 2011, the French National Assembly launched a financial audit of EDF and Areva, to examine the terms of the Uramin takeover. Member of Parliament Marc Goua expressed surprise that Areva had not detected the overvaluation of resources announced by UraMin. He was astonished that "the Agence des participations de l'État, which was initially very cautious about the dossier, considered it a great victory in July 2007", but a few months later, Areva had to make provisions of 2.36 billion in its budget to settle its debts. The audit found no trace of illegal interest-taking, but based on the names of UraMin shareholders, it was considered possible that they were trust companies operating in the tax haven where UraMin was based.
At the end of October 2011, Sébastien de Montessus, then head of mining at Areva, travelled to Bangui to inform Central African President François Bozizé that the Bakouma uranium mine project had been frozen.
On December 13, 2011, Areva announced that it was suspending its investments in uranium mining projects at Ryst Kuil in South Africa and the Trekkopje uranium mine in Namibia. After investing 1 billion euros in the Trekkopje mine's infrastructure - including a seawater desalination plant - Areva announces the mine's closure due to lack of economic profitability. Areva's supervisory board also announced that it had launched an internal investigation into the UraMin takeover "to examine the conditions under which UraMin was acquired and operated, and to draw lessons for the Group"; the investigation will be conducted by three "independent" members of the board, aiming for a conclusion by early 2012.
At the end of 2011, Areva's takeover of Uramin was the subject of controversy, before proving to be a source of heavy financial losses. A further 80% write-down of the mining company's value took place because the deposit turned out to be less rich in uranium than announced, and due to a drop in uranium prices, particularly after the Fukushima nuclear accident.
At the same time, Luc Oursel, newly appointed Chairman of Areva's management board in June 2011, commissioned lawyer Jean Reinhart to produce a report on the UraMin fiasco.