Uranium Energy Corp. is pleased to announce the Company has entered into a definitive share purchase agreement with Uranium One Investments Inc., a subsidiary of Uranium One Inc. (“Uranium One”), to acquire all the issued and outstanding shares of Uranium One Americas, Inc. (“U1A”) for a total purchase price comprised of $112 million in cash and the replacement (with corresponding payments to the seller) of $19 million in reclamation bonding (the “Acquisition“). Uranium One is the world’s fourth largest uranium producer and part of Russia’s State Atomic Energy Corporation, Rosatom.
The Acquisition is fully funded with UEC’s existing balance sheet, which as of October 26, 2021 had over $235 million of cash and market value liquid assets.
The U1A assets are primarily situated in the Powder River Basin of Wyoming; the most productive in-situ recovery (“ISR”) uranium mining district in the western hemisphere.
Highlights of the Acquisition include the following:
Amir Adnani, President and CEO, stated: “We are very pleased that after a comprehensive and competitive bidding process, Uranium One elected to work with UEC to undertake the successful sale of their substantial uranium assets in the United States. This is a highly accretive transaction for UEC and represents great value to our shareholders. The purchase price is equal to only 12% of our current enterprise value, yet the acquisition doubles the size of our production capacity in three key categories: total number of permitted U.S. ISR projects, resources, and processing infrastructure. The opportunity to acquire an advanced asset base of this quality from one of the global leaders in the nuclear energy sector is highly rare in the uranium sector anywhere in the world, let alone in our own home jurisdiction of the United States.”
Mr. Adnani continued: “Additionally, we expect significant savings related to the development of our nearby Reno Creek ISR Project. We also anticipate long-lasting operational synergies and cost efficiencies in our newly formed Wyoming hub-and-spoke operations. The U1A Irigaray Central Processing Plant will be able to process our fully licensed Reno Creek ISR project, in addition to the fully permitted Moore Ranch, Ludeman and Christensen Ranch projects in the U1A portfolio purchased in this transaction.”
Mr. Adnani concluded: “The assets in this transaction are some of the lowest cost U.S. projects along with fast restart capabilities in the most productive region of the western hemisphere for in-situ recovery of uranium, Wyoming’s Powder River basin. With this Acquisition, our U.S. ISR production profile increases to 6.5 million pounds U3O8 per year based on licensed and installed capacity of our Wyoming and South Texas hub-and-spoke operations. Combined with our physical uranium holdings of 4.1 million pounds of U.S. warehoused uranium, we now have the unparalleled ability to provide reliable domestic supply to the U.S. Uranium Reserve as well as re-emerging demand from American and global nuclear utilities.”
UEC Chairman and former U.S. Energy Secretary, Spencer Abraham, commented: “This is a very proud day for UEC to have reached a successful transaction with Uranium One. We have been working for a considerable time to acquire this important portfolio and it is rewarding for our Company to see it come to fruition. We believe this achievement will accelerate and strengthen the development of domestic uranium production that can supply U.S. origin uranium for a full range of America’s uranium requirements.”
Alexander Fedotov, Uranium One Chairman, and President of U1A, stated, “We are also pleased to share news of the signing of a definitive agreement by which UEC will acquire our U.S. assets. This transaction will provide a material return for Uranium One’s owners and shareholders in the process.”
Closing of the Acquisition is subject to certain regulatory approvals.
Advisors and Counsel
VTB Capital plc is acting as financial advisor to Uranium Energy Corp. McMillan LLP is acting as Canadian legal advisor to UEC and Holland & Hart is acting as U.S. legal advisor to UEC.
Haywood Securities Inc. is acting as financial advisor to Uranium One and Dorsey & Whitney LLP is acting as U.S. legal advisor to Uranium One.