January 22, 2019 / 6:07 AM / 9 months ago

Jervois Mining offers C$16.6 mln in shares for Uganda cobalt projects

MELBOURNE, Jan 22 (Reuters) - Australian cobalt developer Jervois Mining said on Tuesday it has agreed to buy a Canadian cobalt explorer with operations in Uganda, as the hunt for quality mines in the battery materials sector gains pace.

Jervois, which is backed by ex-Glencore executives, is offering one of its shares for every share in M2 Cobalt, valuing the Canadian company at C$16.6 million ($12.5 million), a 4.5 percent premium at current share prices.

M2 Cobalt has tenements across a region that includes a former copper and cobalt mine run that was closed after being sold the Ugandan government.

Jervois, which has applied for a prospecting licence in Tanzania, said the deal would complement its efforts to establish a presence in east Africa.

M2 shareholders would make up about 22 percent of the expanded company, and Jervois hoped to maintain a listing on Toronto’s TSX Venture Exchange, giving it access to North American capital markets.

Jervois Chief Executive Bryce Crocker and Chairman Peter Johnston, both former executives of London-listed miner Glencore , will continue in their current roles.

Jervois is developing the Nico Young cobalt-nickel deposit in the Australian state of New South Wales.

$1 = 1.3316 Canadian dollars Reporting by Melanie Burton; editing by Richard Pullin

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