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First Uranium's Ezulwini facility in South Africa.

First Uranium Corp. was the talk of the mining sector five years ago, enjoying record-high uranium prices and a $1.4-billion market capitalization.

Today, battered by shifting industry dynamics, operational mishaps and a cooler uranium market, First Uranium has a plan to break itself up to help pay back its debts. If only shareholders would let it.

Faced with $150-million in looming obligations it cannot pay, the Toronto-based company agreed in the last two months to sell its Africa-focused gold and uranium assets to two buyers to raise cash. But holders of some large chunks of its stock don't like the plan and promise to block the sale.

Under agreements signed March 2 and April 2, First Uranium agreed to sell its Mine Waste Solutions (MWS) tailings recovery project to South Africa's AngloGold Ashanti for $335-million, and its Ezulwini mine to Australia's Gold One International for $70-million. The agreements came after First Uranium contacted some 20 parties between September last year and January, 2012. It said that only AngloGold, Gold One and one other party signed confidentiality agreements and did due diligence on the company.

Shareholders say the assets are worth double what is on offer, and have pledged to vote down the sales at a special meeting on June 13.

"We feel there is a better deal out there," said Nicholas Betsky, head of Russia's giant OLMA Investment Firm and who claims to represent holders of some 17 per cent of First Uranium's shares, including one of Canada's most prominent resource investment firms, Sprott Asset Management.

"We don't think that the board has done its job, or that management has done its job in exploring the options," he said. "We plan on voting no and are ourselves looking for a better deal."

The company did receive a hostile bid for Ezulwini from Waterpan Mining Corp. and Transalloys (Pty) Ltd. for $80-million that was backed by Russian billionaire Victor Vekselberg's Renova Group, but the offer was viewed as highly conditional.

First Uranium has experienced a precipitous drop in fortunes since it went public on the Toronto Stock Exchange in January, 2007, in the largest initial public offering of a Canadian miner in years.

That was when it took advantage of sky-high uranium prices to brand itself as a producer of the radioactive metal, even though it was to be predominantly a gold company. The stock debuted at about $7 a share, climbing 20 per cent on its first day before eventually hitting over $13 a share in April.

Market capitalization touched $1.4-billion in First Uranium's freshman year, before a series of mishaps over the next five that included worker fatalities, ballooning inflation, higher capital costs and the strengthening of the rand currency. The market capitalization is below $20-million these days, with the stock trading at about 9 cents a share.

Analysts dropped coverage of the company one by one as the value fell.

"I guess, really, the big question mark at the moment is how much support can the dissatisfied shareholders get behind them to try to block the transactions," said Edward Sterck, an analyst for the Bank of Montreal's BMO Capital Markets and just about the only analyst still covering the company.

The shareholders group, which claims 41 million shares out of 80 million shares eligible to vote, says it's confident it has the support to vote down the sales.

"If they want us to vote yes, they're going to have to get AngloGold and Gold One to increase the price. If they don't, which they don't seem to want to, we're going to vote no," said Mr. Betsky, who thinks shareholders would fare better if the company declared bankruptcy than under the current deals.

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