PERTH, Australia — Paladin Energy Ltd. (TSX:PDN), an Australian uranium producer that's listed on the Toronto Stock Exchange, said Thursday it has resolved a two-year-long dispute between its subsidiary Summit Resources Ltd. and Areva NC Pty Ltd.
Paladin announced Thursday it has reached a settlement that resolves the dispute with Areva, "and thereby paves the way for Paladin and Areva work co-operatively as shareholders of Summit Resources Ltd."
In April 2007, Summit entered into a strategic alliance with Areva, a subsidiary of the French nuclear enterprise. Under the alliance, Areva would subscribe for shares in Summit, giving it marketing rights over two-thirds of Summit's uranium production from its Australian projects.
Later that month, the directors of Summit recommended acceptance of a takeover offer by Paladin. At the close of the offer, Areva held 10.5 per cent of the shares in Summit and Paladin held 82 per cent.
In August of that year, Summit announced it agreed to settle a legal dispute with Resolute Ltd. and Mt Isa Uranium Pty Ltd.
Areva applied to intervene in the proceedings, seeking to restrain Summit and the defendants from making the agreement binding.
Its application to intervene was heard this summer and a judgement has yet to be delivered.
On Oct. 16, Summit entered into a conditional agreement with Areva, Resolute and Paladin without any party admitting liability to another.
If the settlement agreement becomes unconditional by the court, Areva's application to intervene will be dismissed, the strategic alliance will end, and Summit will pay A$4.5 million to Areva.
Shares in Paladin were trading down less that a per cent at C$4.03 on the Toronto Stock Exchange Tuesday.