Magnetic susceptibility measurements and Mossbauer spectra show that NdCoO3 and GdCoO3 contain predominantly low-spin CoIII ions at low temperatures which transform partially to high-spin Co3+ until a certain temperature. Beyond this temperature, there is a transfer of eg electrons from Co3+ to CoIII giving rise to di- and tetra-valent Co species followed by short-range ordering. Co3+ ions completely disappear at about 1000 K where there is a gradual transition from localized electron behaviour to collective behaviour. The cobaltates are semi-metals beyond this transition. The spin state equilibria and the electronic transition described here find support from electron transport properties, Mossbauer parameters as well as differential thermal analysis and X-ray data.