Uranium Energy (NYSE American: UEC) on Tuesday entered into a definitive agreement to acquire all outstanding shares of Uranium One Americas Inc. (U1A) for a total purchase price of $112 million, comprising cash and the replacement of $19 million in reclamation bonding.
U1A is a subsidiary of Uranium One Inc., which is part of Russia’s state atomic energy company Rosatom and the world’s fourth-largest uranium producer.
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.
There are seven projects in the U1A portfolio, three of which are fully permitted. The combined historical resource is estimated at 37.6 million pounds U3O8 measured and indicated, plus 4.3 million pounds U3O8 inferred.
“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,” UEC CEO Amir Adnani said in a press release.
Commenting on the value of the transaction, Adnani pointed out that the purchase price was equal to only 12% of UEC’s current enterprise value, yet the acquisition doubled the size of its production capacity in three key categories: total number of permitted US ISR projects, resources and processing infrastructure.
The acquisition would create UEC’s hub-and-spoke operations in Wyoming, anchored by U1A’s Irigaray plant, which is one of the largest central processing facilities in the US with a licensed capacity of 2.5 million pounds U3O8 per year.
UEC would incorporate U1A’s production-ready assets, including the Christensen Ranch ISR project with four fully installed wellfields, and six additional permitted or development-stage satellite ISR projects, combining with its own permitted Reno Creek ISR project.
The company is also expecting “significant capital expenditure savings and deep operating synergies” related to the development of the Reno Creek ISR project, which is 72 km away from the Irigaray plant.
According to Adnani, the newly acquired assets represent some of the lowest cost ISR projects in the US, with fast restart capabilities, and would increase UEC’s production profile to 6.5 million pounds U3O8 per year based on licensed and installed capacity of its Wyoming and South Texas operations.
The transaction positions UEC as the largest American uranium mining company amid a new era of domestic and global support for clean-air nuclear energy.
“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 US origin uranium for a full range of America’s uranium requirements,” UEC chairman and former US Energy Secretary Spencer Abraham said in the statement.
UEC’s stock was down 1.3% as of 12:10 p.m. EDT following news of the new uranium asset acquisition. The company has a market capitalization of $1.3 billion.