Energy Fuels Inc. (TSE:EFR, NYSE:UUUU) said it has closed the sale of certain non-core uranium properties in Wyoming to Uranium Energy Corp. (NYSE:UEC) for US$5.39mln.
The total price includes US$2.94mln of cash and US$2.45mln of shares in Uranium Energy at a deemed issuance price of US$1.5072 per share of Uranium Energy.
READ: Energy Fuels nudges higher as it outlines opportunities to lift uranium output
The properties, which are adjacent to UEC's Reno Creek Project, are considered non-core, as they would require extensive permitting and licensing work, and significant time and capital, to bring them into commercial operation as a standalone project in the future.
Further, it said it holds other low-cost ISR assets that are currently either in production or can be brought into production sooner and on a greater scale than the sold assets.
This includes the operating and fully-permitted Nichols Ranch ISR Project and the fully-permitted Jane Dough and Hank properties in Wyoming, along with the fully-constructed, licensed, and permitted Alta Mesa ISR Project in Texas which is currently on standby.
Energy Fuels said it believes the sold assets are much better suited to be combined with UEC's Reno Creek Project.
Mark S. Chalmers, president and CEO of Energy Fuels said: "Maintaining the strength of our balance sheet is one of the central focuses of Energy Fuels. Therefore, we are endeavoring to monetize certain assets that are stranded or non-core to our long-term business plans.
Adds over US$5mln to balance sheet
“The completion of today's transaction achieves this focus, by adding over $5 million to our balance sheet and reducing our holding costs. This is a remarkable time in the U.S. uranium market, and our filing of a 232 Petition earlier this year with the U.S. government has the strong potential to significantly increase the value of uranium produced in the United States.
While we are disposing of stranded and non-core assets, we are retaining low-cost producing, constructed, and/or permitted assets. These are the assets that will enable Energy Fuels to ramp-up production more quickly and on a greater scale than our peers."
In a separate statement, Amir Adnani, president and CEO of UEC, in describing the acquisition as "highly synergistic", said: "This further cements our position in controlling one of the largest, fully permitted and 100% un-hedged low-cost ISR portfolios in the United States. This acquisition also comes at a time when international trade and geopolitical developments underscore the importance of domestic uranium supplies in support of American energy security."
Energy Fuels is an integrated U.S. uranium mining company, supplying U3O8 to major nuclear utilities.