Proactive Investors - Run By Investors For Investors

Uranium trader Yellow Cake to list on AIM next month

Uranium is structurally mis-priced, says Yellow Cake
Uranium
Yellow Cake will store its uranium at Cameco's Port Hope and Blind River facilities in Canada

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.

View full YCA profile View Profile

Yellow Cake PLC Timeline

Related Articles

Process plant
May 16 2019
AfriTin Mining Limited (LON:ATM) is developing the Uis tin project in north-west Namibia Phase 1 will see process 500,000 tonnes of ore per annum processed This will produce 60 tonnes of tin concentrate per month. Phase 2 will see capacity rise to 3mln tonnes per annum, producing the 5,000 tonnes of tin concentrate
copper
May 31 2019
Chief executive Michael McNeilly said 2018 was a “transformational year” for the group w
1557332083_Tungsten.jpg
May 09 2019
Apollo has an attractive land package in France and Spain, including former producing mine

© Proactive Investors 2019

Proactive Investors Limited, trading as “Proactiveinvestors United Kingdom”, is Authorised and regulated by the Financial Conduct Authority.
Registered in England with Company Registration number 05639690. Group VAT registration number 872070825 FCA Registration number 559082. You can contact us here.

Market Indices, Commodities and Regulatory News Headlines copyright © Morningstar. Data delayed 15 minutes unless otherwise indicated. Terms of use