Proactiveinvestors United Kingdom Yellow Cake PLC https://www.proactiveinvestors.co.uk Proactiveinvestors United Kingdom Yellow Cake PLC RSS feed en Sun, 19 May 2019 16:10:18 +0100 http://blogs.law.harvard.edu/tech/rss Genera CMS action@proactiveinvestors.com (Proactiveinvestors) action@proactiveinvestors.com (Proactiveinvestors) <![CDATA[RNS press release - Holding(s) in Company ]]> https://www.proactiveinvestors.co.uk/companies/rns/16509/LSE20190507070009_14063813/ Tue, 07 May 2019 07:00:09 +0100 https://www.proactiveinvestors.co.uk/companies/rns/16509/LSE20190507070009_14063813/ <![CDATA[Media files - Price pullback gives Yellow Cake good opportunity to acquire additional uranium ]]> https://www.proactiveinvestors.co.uk/companies/stocktube/13170/price-pullback-gives-yellow-cake-good-opportunity-to-acquire-additional-uranium-13170.html Wed, 01 May 2019 13:05:00 +0100 https://www.proactiveinvestors.co.uk/companies/stocktube/13170/price-pullback-gives-yellow-cake-good-opportunity-to-acquire-additional-uranium-13170.html <![CDATA[News - Yellow Cake hails robust market fundamentals for uranium ]]> https://www.proactiveinvestors.co.uk/companies/news/219166/yellow-cake-hails-robust-market-fundamentals-for-uranium-219166.html Physical uranium stockpiler Yellow Cake PLC (LON:YCA) said the recent pullback in spot prices presented a good buying opportunity as it remained confident in the long-term outlook for the radioactive metal.

The global spot uranium price softened to end the quarter at US$25.75 per pound of U3O8, from US$28.50/lb three months before.

After the US Department of Commerce submitted a report to the White House about the impact of the importation of foreign-source uranium, Yellow Cake chief executive Andre Liebenberg said: "Our confidence in the long-term outlook for uranium is unchanged despite the short-term uncertainty created by the Section 232 investigation in the US.”

The US government has 90 days to respond to the report and either take no action or legislate, which could take the form of tariffs or quotas.

Robust fundamentals

“We see robust market fundamentals regardless of the outcome of the Section 232 investigation, where rising demand and constrained supply, together with the steady run-off of long-term contracts has created a positive price environment,” Liebenberg said. “The recent pullback in the uranium price provided us with a good opportunity to acquire additional uranium at a competitive price.”

Since the end of the first quarter, the company raised £25.9mln in a placing to buy 1.175mln lbs of uranium from Kazakstan’s state-owned NAC Kazatomprom JSC at a price of US$25.88/lb.

Before the purchase, Yellow Cake’s estimated net asset value stood at 224p at the end of the first quarter, compared to 253p at the end of December. The NAV is a premium of around 5% to the closing price on Thursday.

After the Kazatomprom deal, which was made as part of an option under a framework agreement that offers the option to hoover up to US$100mln each year until 2028, the company owns 9.62mln lbs of uranium, acquired at an average cost of US$21.68/lb.

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Fri, 26 Apr 2019 08:49:00 +0100 https://www.proactiveinvestors.co.uk/companies/news/219166/yellow-cake-hails-robust-market-fundamentals-for-uranium-219166.html
<![CDATA[RNS press release - Quarterly Operating Update ]]> https://www.proactiveinvestors.co.uk/companies/rns/16509/LSE20190426070010_14052760/ Fri, 26 Apr 2019 07:00:10 +0100 https://www.proactiveinvestors.co.uk/companies/rns/16509/LSE20190426070010_14052760/ <![CDATA[RNS press release - Holding(s) in Company ]]> https://www.proactiveinvestors.co.uk/companies/rns/16509/LSE20190418135229_14046793/ Thu, 18 Apr 2019 13:52:29 +0100 https://www.proactiveinvestors.co.uk/companies/rns/16509/LSE20190418135229_14046793/ <![CDATA[RNS press release - Holding(s) in Company ]]> https://www.proactiveinvestors.co.uk/companies/rns/16509/LSE20190418112005_14046527/ Thu, 18 Apr 2019 11:20:05 +0100 https://www.proactiveinvestors.co.uk/companies/rns/16509/LSE20190418112005_14046527/ <![CDATA[RNS press release - Holding(s) in Company ]]> https://www.proactiveinvestors.co.uk/companies/rns/16509/LSE20190417142530_14045079/ Wed, 17 Apr 2019 14:25:30 +0100 https://www.proactiveinvestors.co.uk/companies/rns/16509/LSE20190417142530_14045079/ <![CDATA[RNS press release - Holding(s) in Company ]]> https://www.proactiveinvestors.co.uk/companies/rns/16509/LSE20190416070014_14042093/ Tue, 16 Apr 2019 07:00:14 +0100 https://www.proactiveinvestors.co.uk/companies/rns/16509/LSE20190416070014_14042093/ <![CDATA[News - Yellow Cake ups share placing to £25.9mln amid strong investor demand ]]> https://www.proactiveinvestors.co.uk/companies/news/218480/yellow-cake-ups-share-placing-to-259mln-amid-strong-investor-demand-218480.html Yellow Cake PLC (LON:YCA) is raising £25.9mln, increased from £22.9mln, through a share placing in order to fund the purchase of at least 1mln pounds of uranium.

The company, a vehicle specifically set up to acquire and own physical uranium as an investment strategy, upgraded the funding after the original offer (announced yesterday) saw strong investor demand.

Via a framework agreement with Kazatomprom – a Kazakstan state-owned miner and the world’s largest producer of natural uranium – the London listed firm can buy at a price of US$25.88 per pound, and, it has the option to acquire up to US$100mln worth of uranium during 2019.

WATCH: Yellow Cake gives investors unique exposure to uranium

Yellow Cake said that the current uranium price represents a “compelling buying opportunity” as it sees the opportunity to take advantage of power utilities’ currently cautious approach to purchasing ahead of action by the United States, in its investigation into uranium imports.

In a statement on Friday, chief executive Andre Liebenberg said: "We welcome the support from both our existing and new shareholders to enable us to increase the size of our fundraising and consequentially to now purchase 1.175 mmlb of uranium at the firm price of US$25.88 per pound.

“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."

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Fri, 12 Apr 2019 08:08:00 +0100 https://www.proactiveinvestors.co.uk/companies/news/218480/yellow-cake-ups-share-placing-to-259mln-amid-strong-investor-demand-218480.html
<![CDATA[RNS press release - Result of placing ]]> https://www.proactiveinvestors.co.uk/companies/rns/16509/LSE20190412070005_14038596/ Fri, 12 Apr 2019 07:00:05 +0100 https://www.proactiveinvestors.co.uk/companies/rns/16509/LSE20190412070005_14038596/ <![CDATA[RNS press release - Proposed Uranium Purchase, Placing of New Shares ]]> https://www.proactiveinvestors.co.uk/companies/rns/16509/LSE20190411164513_14038311/ Thu, 11 Apr 2019 16:45:13 +0100 https://www.proactiveinvestors.co.uk/companies/rns/16509/LSE20190411164513_14038311/ <![CDATA[RNS press release - Quarterly Operating Update ]]> https://www.proactiveinvestors.co.uk/companies/rns/16509/LSE20190116070003_13935887/ Wed, 16 Jan 2019 07:00:03 +0000 https://www.proactiveinvestors.co.uk/companies/rns/16509/LSE20190116070003_13935887/ <![CDATA[RNS press release - Half-year Report ]]> https://www.proactiveinvestors.co.uk/companies/rns/16509/LSE20181126070007_13879419/ Mon, 26 Nov 2018 07:00:07 +0000 https://www.proactiveinvestors.co.uk/companies/rns/16509/LSE20181126070007_13879419/ <![CDATA[RNS press release - Holding(s) in Company ]]> https://www.proactiveinvestors.co.uk/companies/rns/16509/LSE20181105090046_13854787/ Mon, 05 Nov 2018 09:00:46 +0000 https://www.proactiveinvestors.co.uk/companies/rns/16509/LSE20181105090046_13854787/ <![CDATA[RNS press release - Second Price Monitoring Extn ]]> https://www.proactiveinvestors.co.uk/companies/rns/16509/LSE20181031164046_13850139/ Wed, 31 Oct 2018 16:40:46 +0000 https://www.proactiveinvestors.co.uk/companies/rns/16509/LSE20181031164046_13850139/ <![CDATA[RNS press release - Price Monitoring Extension ]]> https://www.proactiveinvestors.co.uk/companies/rns/16509/LSE20181031163526_13850127/ Wed, 31 Oct 2018 16:35:26 +0000 https://www.proactiveinvestors.co.uk/companies/rns/16509/LSE20181031163526_13850127/ <![CDATA[RNS press release - Holding(s) in Company ]]> https://www.proactiveinvestors.co.uk/companies/rns/16509/LSE20181018163600_13834524/ Thu, 18 Oct 2018 16:36:00 +0100 https://www.proactiveinvestors.co.uk/companies/rns/16509/LSE20181018163600_13834524/ <![CDATA[RNS press release - Price Monitoring Extension ]]> https://www.proactiveinvestors.co.uk/companies/rns/16509/LSE20181017163520_13832899/ Wed, 17 Oct 2018 16:35:20 +0100 https://www.proactiveinvestors.co.uk/companies/rns/16509/LSE20181017163520_13832899/ <![CDATA[News - Yellow Cake offers investors direct exposure to physical uranium, and all its associated upside ]]> https://www.proactiveinvestors.co.uk/companies/news/206893/yellow-cake-offers-investors-direct-exposure-to-physical-uranium-and-all-its-associated-upside-206893.html Nearly half of uranium production doesn’t make money at the prevailing spot price. That’s the startling statistic highlighted by Andre Liebenberg, the chief executive of Yellow Cake PLC (LON:YCA).

Yellow Cake has been set up to provide investors with a clean entry point into what has hitherto been a pretty opaque market. What really is the true price of uranium? There’s the spot price, of course, but that really only tells half, or even less than half, the story.

WATCH: Yellow Cake Plc giving investors unique exposure to uranium price

Most uranium production is actually locked into long-term contracts, which is why it can afford to keep going even with the uranium price still trading at under US$30 per pound.

When those contracts are up, though, the chances are the production will be idled, and that in turn is likely to lead to an increase in price as supply dwindles.

It will be an interesting inflexion point, and one at which investors could stand to make a lot of money.

But even on that medium-term bullish outlook, there are still limited ways to play the uranium market. There are the majors of course, like Cameco (TSE:CCO), and there are junior explorers too, like Manhattan Corporation LTD (ASX:MHC). But both will be subject to the vagaries of sentiment in a market in which the supply-demand dynamic is likely to change rapidly.

But for a more straightforward long-only option there’s Yellow Cake.

Yellow Cake was set up by veteran mining financier Pete Bacchus, the man who successfully defended Rio Tinto against a hostile takeover bid during the last boom. He’s now set up on his own at Bacchus Capital Advisers and, amongst other things, has put together Yellow Cake for his clients.

The company listed on the London Stock Exchange in July of this year, and is the only vehicle of its kind in Europe. There is a similar vehicle in Canada, which was one of the inspirations behind Yellow Cake, but Liebenberg doesn’t regard it as a competitor.

The more companies there are around stockpiling physical uranium, the tighter the supply becomes and the better it is for the spot price.

But is it enough to make a difference?

Liebenberg is a firm uranium bull. Worth noting for a start that since Yellow Cake listed, the price has risen from just over US$22 per pound to just over US$27 per pound, and that’s a trend he thinks is set to continue.

“We think we’re closer to the bottom than the top,” he says.

“In uranium the demand side is actually very visible,” he says. “The lead times are long and the build times are long. But the supply side hasn’t been visible, particularly post Fukushima. And Yellow Cake is a vehicle that allows investors to take a view on the uranium price,” says Liebenberg.

The company is long-only on uranium, so investors needn’t worry about the value becoming tangled up in a complicated web of financial instruments.

Yellow Cake has big enough backers​

In fact, it couldn’t be more simple. Yellow Cake holds just under 8.45mln pounds of physical uranium in a warehouse owned by Cameco. As at 3rd October that uranium was worth 242p per Yellow Cake share, while the company itself was trading on the market at 240p. So the discount is running at about 1%, much narrower than most investment companies, and testament to the simplicity and transparency of the vehicle.

Down the line, there’s even the possibility that Yellowcake could do some small royalty deals which would deliver enough cash flow to cover the running costs and allow the shares to trade at exactly par value, or even at a premium.

Why should Yellow Cake trade at a premium when it’s benchmarked against spot? The answer is that if you are bullish uranium and you think the price is going to rise, taking a position early in a vehicle like Yellow Cake is one way to catch the upside early.

And of course, if the Yellow Cake share price does end up trading at a premium to net assets, that will create an opportunity for Liebenberg.

“If we were trading at a premium we could issue stock and buy uranium,” says Liebenberg. “And if we were trading at a persistent discount we could consider selling uranium and buy stock.”

The company has an agreement in place with Kazatomprom that allows for the purchase of up to US$100mln worth of uranium a year, and crucially that deal allows for the fixing of the amount and the price before Yellow Cake goes into the market for new money.

That allows the company to be precise about the nature of the deal it will put to existing and potentially new shareholders in the event of a future raise. Yellow Cake has big enough backers to allow it to be pretty confident of securing additional funding. The real question is whether or not it’s right in its bullish call on uranium.

We’ll find out soon enough.

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Thu, 11 Oct 2018 12:31:00 +0100 https://www.proactiveinvestors.co.uk/companies/news/206893/yellow-cake-offers-investors-direct-exposure-to-physical-uranium-and-all-its-associated-upside-206893.html
<![CDATA[Media files - Yellow Cake Plc giving investors unique exposure to uranium price ]]> https://www.proactiveinvestors.co.uk/companies/stocktube/10711/yellow-cake-plc-giving-investors-unique-exposure-to-uranium-price-10711.html Wed, 03 Oct 2018 08:31:00 +0100 https://www.proactiveinvestors.co.uk/companies/stocktube/10711/yellow-cake-plc-giving-investors-unique-exposure-to-uranium-price-10711.html <![CDATA[RNS press release - Quarterly Operating Update ]]> https://www.proactiveinvestors.co.uk/companies/rns/16509/LSE20181003070007_13814047/ Wed, 03 Oct 2018 07:00:07 +0100 https://www.proactiveinvestors.co.uk/companies/rns/16509/LSE20181003070007_13814047/ <![CDATA[RNS press release - Price Monitoring Extension ]]> https://www.proactiveinvestors.co.uk/companies/rns/16509/LSE20181002120233_13813281/ Tue, 02 Oct 2018 12:02:33 +0100 https://www.proactiveinvestors.co.uk/companies/rns/16509/LSE20181002120233_13813281/ <![CDATA[RNS press release - TR-1: Notification of major holding ]]> https://www.proactiveinvestors.co.uk/companies/rns/16509/LSE20180824175907_13768295/ Fri, 24 Aug 2018 17:59:07 +0100 https://www.proactiveinvestors.co.uk/companies/rns/16509/LSE20180824175907_13768295/ <![CDATA[RNS press release - Purchase of additional Uranium ]]> https://www.proactiveinvestors.co.uk/companies/rns/16509/LSE20180810070004_13750676/ Fri, 10 Aug 2018 07:00:04 +0100 https://www.proactiveinvestors.co.uk/companies/rns/16509/LSE20180810070004_13750676/ <![CDATA[RNS press release - Holding(s) in Company ]]> https://www.proactiveinvestors.co.uk/companies/rns/16509/LSE20180731091730_13737506/ Tue, 31 Jul 2018 09:17:30 +0100 https://www.proactiveinvestors.co.uk/companies/rns/16509/LSE20180731091730_13737506/ <![CDATA[RNS press release - Holding(s) in Company ]]> https://www.proactiveinvestors.co.uk/companies/rns/16509/LSE20180717144707_13721150/ Tue, 17 Jul 2018 14:47:07 +0100 https://www.proactiveinvestors.co.uk/companies/rns/16509/LSE20180717144707_13721150/ <![CDATA[News - Uranium outlook decidedly mixed, says Liberum, favours Yellow Cake ]]> https://www.proactiveinvestors.co.uk/companies/news/200675/uranium-outlook-decidedly-mixed-says-liberum-favours-yellow-cake-200675.html UK broker Liberum has sounded a note of caution about the future supply-demand balance in the uranium market.

In a detailed 11-page research note Liberum set out its case that although demand for uranium from new power stations is likely to be material, the rise of renewables and an increasing tendency to favour gas-powered electricity generation will mitigate against any significant breakout in the price in the near-term.

In particular, Liberum also noted that the uranium market is not currently in deficit, as supply from stockpiles continues to be fed into the market, and that it could take years before all this inventory is drawn down.

Based on BP's projections

Much of this analysis is based on projections put together by BP in its Energy Outlook report. BP has downgraded its future demand estimates for power from coal, nuclear and hydro. The likely reduction in coal-fired power is not particularly surprising, as this trend has been well highlighted both in the financial and in the popular press. Even the Chinese are beginning to move on from coal, although it does still have far more adherents in Africa and the Far East than it does in Europe.

In the case of hydro power, it’s the capital costs involved that will likely render it less popular. But nuclear has a powerful mixture of environmental, political and capital risk that has meant that a range of forecasters, not just BP, are now becoming quite conservative in their predictions for future demand.

At the lower end of the scale, Statoil predicts demand for nuclear power will grow by just over 1% by 2040. The EIA has growth at around 1.5%, while BP is roughly in the middle with a forecast of 1.8% growth. At the high end is CNPC, which forecasts demand growth of just over 3% by 2040.

These figures show an industry in reasonable shape, but not one that’s likely to roar away. And uranium miners, therefore, will have to model current and future production very carefully to ensure an economic return.

Permitting issues and Berkeley Energia

Notably, Liberum is lukewarm towards market favourite Berkeley Energia (LON:BKY). Liberum highlights permitting issues with the Spanish project, although Berkeley Energia itself has recently highlighted the significant support it has both from government and local communities on the ground in Spain.

What’s perhaps more interesting from the perspective of the Liberum research isn’t so much the likely success of failure of Berkeley’s Salamanca mine itself, but the fact that it’s the only uranium mine of any significance currently in development anywhere in the world.

Still, all that being said, Liberum does expect a steady increase in the uranium spot price over the next five years, rising from the current price of around US$20 to closer to US$60 by 2025.

That should go a long way towards making the Berkeley Energia mine economic, and might perhaps stimulate further mine restarts. But of course, if those restarts bring further supply into the market, the price itself will be subject to more downward pressure.

Yellow Cake

Liberum’s preferred way of playing these complex dynamics is through market newcomer Yellow Cake PLC (LON:YCA), which is aiming to trade in uranium and in particular is likely to buy up much of the spot market excess supply that’s currently available.

Clearly, if the uranium price does move as Liberum expects, this could be a very successful medium-term strategy. It also obviates the need for mining and permitting risk, and although there is significant capital outlay involved, that capital will come straight onto the Yellow Cake balance sheet and can be marked to market.

But for all its risks, the financial forecasts Liberum has put together for Berkeley Energia still make it look fairly attractive. The company is likely to have cleared its debts in five years, and to be generating a profit of around US$170mln.

That’s not bad going from a company which has only been around a couple of years, and goes to show that even in unfavourable markets, skilled positioning and skilled people can still get things done.

 

 

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Thu, 12 Jul 2018 10:38:00 +0100 https://www.proactiveinvestors.co.uk/companies/news/200675/uranium-outlook-decidedly-mixed-says-liberum-favours-yellow-cake-200675.html
<![CDATA[RNS press release - Holding(s) in Company ]]> https://www.proactiveinvestors.co.uk/companies/rns/16509/LSE20180712093005_13715381/ Thu, 12 Jul 2018 09:30:05 +0100 https://www.proactiveinvestors.co.uk/companies/rns/16509/LSE20180712093005_13715381/ <![CDATA[News - Yellow Cake announces receipt of Uranium following its debut on AIM ]]> https://www.proactiveinvestors.co.uk/companies/news/200337/yellow-cake-announces-receipt-of-uranium-following-its-debut-on-aim-200337.html Yellow Cake PLC (LON:YCA) has announced that 8.1mmlb of uranium has been received from Kazatomprom, which is stored at Cameco Corporation’s Port Hope/Bling River facility in Ontario, Canada, following its admission to the AIM market.

The company said its strategy is to be a long-term holder of uranium and the company intends to hold and grow its level of uranium ownership over time.

READ: Uranium trader Yellow Cake debuts on AIM after raising £150mln in its IPO

Yellow Cake believes the recent emerging theme of supply side discipline in the uranium market and the industry cost structure will be supportive of this strategy.

The company sold 76mln new shares at 200p apiece in its initial public offering on July 5, raising US$200mln (£151mln) which it used to buy 8.1mln pounds of uranium from Kazatomprom.

Andre Liebenberg, CEO of Yellow Cake, said: "We would like to thank Kazatomprom for its strong support as a reliable long-term strategic supplier, thereby contributing to the highly successful IPO of Yellow Cake."

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Mon, 09 Jul 2018 07:56:00 +0100 https://www.proactiveinvestors.co.uk/companies/news/200337/yellow-cake-announces-receipt-of-uranium-following-its-debut-on-aim-200337.html
<![CDATA[RNS press release - Receipt of Uranium ]]> https://www.proactiveinvestors.co.uk/companies/rns/16509/LSE20180709070004_13709589/ Mon, 09 Jul 2018 07:00:04 +0100 https://www.proactiveinvestors.co.uk/companies/rns/16509/LSE20180709070004_13709589/ <![CDATA[News - Uranium trader Yellow Cake debuts on AIM after raising £150mln in its IPO ]]> https://www.proactiveinvestors.co.uk/companies/news/200187/uranium-trader-yellow-cake-debuts-on-aim-after-raising-150mln-in-its-ipo-200187.html Uranium trader Yellow Cake PLC (LON:YCA) has made its debut on AIM this morning (Thursday July 5).

Yellow Cake – a nickname for uranium – is backed by Bacchus Capital, the corporate finance boutique set up in 2016 by a group of senior bankers led by Peter Bacchus.

The company reckons Uranium is structurally mis-priced and will make its money from stockpiling the radioactive metal, commodity streaming and royalties.

READ: Yellow Cake to list on AIM in early July

It sold 76mln new shares at 200p apiece in its initial public offering, raising US$200mln (£151mln) which it has used to buy 8.1mln pounds of uranium from Kazatomprom, one of the world’s largest uranium producers.

Yellow Cake paid US$21.01 per pound, a discount of about 8% to the current spot price.

A uranium pile of that size, which cost around US$170mln, is equal to one quarter of Kazatomprom's annual production and approximately 5% of 2016 global marketed production.

In addition, the Kazatomprom contract allows Yellow Cake to buy up to an additional US$100mln of U3O8 each year for the next nine years.

“We are delighted with the outcome of this offering and the strong support from investors for Yellow Cake,” said chief executive Andre Liebenberg.

“Due to an exceptional set of circumstances, uranium is one of the few commodities yet to recover from the recent commodities bear market and we believe that uranium is currently fundamentally and structurally mispriced.”

He added: “Yellow Cake's long-term supply contract with Kazatomprom has allowed us to secure a highly significant and strategic position in physical uranium, at a competitive price, and to offer that exposure to a potential resurgence in the uranium price to investors, while avoiding direct exposure to exploration, development, mining and processing risk.”

Shares were trading at 194p early on Thursday morning, just below the IPO issue price.

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Thu, 05 Jul 2018 09:05:00 +0100 https://www.proactiveinvestors.co.uk/companies/news/200187/uranium-trader-yellow-cake-debuts-on-aim-after-raising-150mln-in-its-ipo-200187.html
<![CDATA[RNS press release - Admission to AIM and First Day of Dealings ]]> https://www.proactiveinvestors.co.uk/companies/rns/16509/LSE20180705070006_13706290/ Thu, 05 Jul 2018 07:00:06 +0100 https://www.proactiveinvestors.co.uk/companies/rns/16509/LSE20180705070006_13706290/ <![CDATA[News - Uranium trader Yellow Cake to list on AIM next month ]]> https://www.proactiveinvestors.co.uk/companies/news/198260/uranium-trader-yellow-cake-to-list-on-aim-next-month-198260.html A uranium trader focused on Kazakhstan is set to make its debut on AIM next month.

Yellow Cake Plc is backed by Bacchus Capital, the corporate finance boutique set up in 2016 by a group of senior bankers led by Peter Bacchus.

Uranium (U3O8) is structurally mis-priced, it says and Yellow Cake will make its money from stockpiling the radioactive metal, commodity streaming and royalties.

Kazakhstan is one of the world’s lowest cost uranium producers and has increased production substantially in recent years.

Added to the curtailing of nuclear programmes following the Fukushima disaster in Japan, this has kept uranium prices under pressure.

The group has a long-term supply contract with Kazakh group Kazatomprom, one of the world's lowest cost producers of uranium, that will see it acquire US$170mln of U3O8 following the IPO.

Yellow Cake is paying US$21.01 per pound, a discount of about 8% to the current spot price.

In addition, the Kazatomprom contract allows it buy up to an additional US$100mln of U3O8 each year for the next nine years.

A uranium pile of US$170mln is equal to one quarter of Kazatomprom's annual production and approximately 5% of 2016 global marketed production.

Yellow Cake is expected to join AIM in early July.

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Tue, 05 Jun 2018 09:11:00 +0100 https://www.proactiveinvestors.co.uk/companies/news/198260/uranium-trader-yellow-cake-to-list-on-aim-next-month-198260.html