UL holds 1,725,000 pounds of uranium oxide (U3O8) and 412,000 kgU as uranium hexafluoride (UF6). Upon completion of the transaction, the combined holdings of uranium material by UPC will consist of 7,250,000 pounds U3O8 and 2,374,230 kgU as UF6.
The transaction allows UPC to acquire additional uranium and provides the current UPC shareholders with increased uranium holdings per share and increased NAV per share.
On completion of the transaction, Kelvin Williams will join the board of UPC. Mr Williams is the current chairman of the board of UL. The existing members of UPC’s board of directors will remain unchanged.
Richard McCoy, chairman of UPC, said: “This transaction allows UPC to grow accretively and at a lower cost than a comparable equity financing and market purchase of uranium. We believe that both UL and UPC shareholders will benefit from enhanced trading liquidity for their shares and the expectation that trading values will closely track underlying NAV.”
Kelvin Williams, non-executive chairman of UL, said: “This transaction provides UL shareholders with a significant premium to the current price of the company’s shares and with ownership in a highly-liquid uranium investment vehicle. We are pleased that this deal preserves for UL shareholders a comparable exposure to anticipated uranium price upside.”
The transaction is subject to the usual regulatory and court approvals and to obtaining the approval of a minimum of 75% by value and over 50% by number approval of those shares, and the majority approval of the shareholders of UPC.
