12th Apr 2019 09:18
LONDON (Alliance News) - Uranium investor Yellow Cake PLC confirmed Friday it has placed 12.0 million shares, raising GBP25.9 million, higher than the GBP22.9 million originally planned.
The shares were priced at GBP2.15 per share, which represents a discount of 4.0% to the company's net asset value at March 31.
Shares in Yellow Cake were down 2.0% Friday morning at GBP2.225.
The shares are expected to be admitted to London's AIM on Tuesday. After the admission, Yellow Cake will have 88.2 million shares in issue.
"The recent pullback in the uranium price has provided us with an excellent window to add to our uranium inventory at an attractive price. We are very confident in the long term fundamentals of the uranium market, where a combination of constrained supply, the run-off of long term contracts and growing demand outlook means we remain confident on the outlook for the uranium price," said Chief Executive Andre Liebenberg.
Liebenberg acquired 35,533 shares in the placing, taking his interest to 73,207 shares - which represents about 0.1% of Yellow Cake's entire issued share capital.
Money raised from the placing will be used to buy at least 1.0 million pounds of physical uranium under its framework agreement with JSC National Atomic Co Kazatomprom. Yellow Cake's goal is to hold physical uranium on a long-term basis.
Around 90% of the proceeds from the placing will be used to buy uranium from Kazatomprom at a price of USD25.88 per pound. The rest will be used for "general corporate purposes"
Yellow Cake said that, despite the increase in the price of uranium in 2018, new sources are limited and the incentive price for new production is estimated to be around USD50.00 per pound.
Related Shares:
Yellow Cake