ATHA announces three-way merger with Latitude, 92 Energy to bolster Canadian uranium portfolio

Credit: ATHA Energy

ATHA Energy (CSE: SASK) on Thursday sealed two separate all-stock deals to acquire Latitude Uranium (CSE: LUR) and 92 Energy (ASX: 92E) to create what it says will be a leading Canadian uranium exploration company.

ATHA is holder of the largest cumulative exploration package in each of the Athabasca and Thelon basins, two of the world’s most prominent regions for uranium discoveries, with 6.1 million total acres along with a 10% carried interest portfolio of claims in the Athabasca operated by NexGen Energy (TSX: NXE) and Iso Energy (TSXV: ISO).

Exploration-stage Latitude is focused on the Angilak project in Nunavut and the CMB project in Newfoundland and Labrador. Together, the Angilak and CMB projects host significant historical resources (57 million lb. U3O8) and are undergoing active district-scale exploration programs.

92 Energy has nine exploration projects all located within the Athabasca basin region, including the Gemini discovery made in September 2021. The Gemini project is 27 km southeast of the McArthur River uranium mine and 60 km northeast of the Key Lake uranium mill.

“We are thrilled for ATHA to have such an incredible opportunity to create Canada’s premier exploration company during a period where the world’s increasing adoption of nuclear energy is calling for new supplies of uranium,” ATHA chief executive Troy Boisjoli said in a news release.

The deal to acquire Latitude will see ATHA issue 0.2769 of a common stock per Latitude share acquired. This consideration gives the Latitude shares an implied value of C$0.28 each, representing a 68% premium to its most recent closing price.

Under the 92E arrangement, ATHA will issue 0.5834 of a common stock for each 92E share, for an implied consideration of C$0.58 per share and a 78% premium. Upon completion, 92E’s listing in Australia will be removed.

The resulting Canadian issuer is expected have an implied market value of approximately C$267 million, with existing shareholders of ATHA, Latitude and 92E owning approximately 49.25%, 25.38% and 25.37% of the company respectively.

“This merger helps realize the true value of 92E assets, while combining three excellent teams that have the resources to pursue uranium exploration at an unprecedented scale,” 92 Energy CEO Siobahn Lancaster added.

The combined company, according to Latitude’s CEO John Jentz, will be “fully funded with C$55 million in cash and boasts a suite of highly complementary uranium assets across the exploration spectrum.”

Concurrent with the merger, ATHA is also undertaking a private placement to raise proceeds of roughly C$14.05 million that will be used to advance the exploration and development of its portfolio of uranium assets.

Shares of ATHA Energy gained 6.5% by market close Thursday for a market capitalization of C$125.1 million. Meanwhile, shares of Latitude closed 36.4% higher with a C$45.9 million market capitalization. 92E shares fell 5.2% with market capitalization of A$38.3 million at the end of the Australia’s trading session.