April 28, 2011 / 9:03 PM / 7 years ago

UPDATE 1-CIC Energy-JSW deal in trouble over Botswana project

* CIC says in talks with Botswana govt to get “comfort letter”

* Says continues to get offers from other companies

April 28 (Reuters) - CIC Energy Corp said its buyout by Indian power utility JSW Energy Ltd might be terminated or delayed if it fails to get a “comfort letter” from the Botswana government for its 300 MW power project in the African country.

Last November, CIC had agreed to a C$422 million, or C$7.42 a share, buyout offer from JSW Energy, subject to CIC having obtained such a comfort letter from the Government of Botswana.

CIC said it has begun talks with JSW and the government of Botswana. The discussions are expected to conclude by May 31.

CIC, which continues to receive offers from other companies, said the deal may also be delayed by several weeks pending talks and fulfilment of several conditions. It had expected to close the deal by end of May.

If the proposed acquisition of CIC is not completed by May 31, either CIC Energy or JSW will be entitled to terminate the supplementary agreement, CIC said in a statement.

Last month, the Botswana government had declined to renew one of CIC’s two mining licenses. [ID:nL3E7EV2ZA]

“Should the supplementary agreement be terminated, CIC Energy will review its strategic plans, including exploring alternative corporate transactions,” CIC added.

CIC shares closed at C$4.39 on Thursday on the Toronto Stock Exchange. (Reporting by Arnika Thakur in Bangalore)

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