GTI Resources Ltd (ASX:GTR) is offloading its non-uranium assets, one of which is the Kookynie Gold Project to be acquired by Regener8 Resources during that company’s listing to the ASX.
Regener8 has made a priority offer to GTR shareholders in tandem with the lodging of a prospectus with ASIC to raise up to $5.5 million for its initial public offering (IPO).
GTI Resources is divesting non-core assets to focus on its highly prospective uranium assets in the US while retaining a material shareholding and board representation in a well-funded entity (Regerner8) focused on gold exploration in Western Australia.
GTI will receive 5 million Regener8 shares (valued at $1 million with a $0.20 share price), 1.5 million performance rights and $150,000 in cash upon completion of the IPO and acquisition.
Regener8 is making a priority offer of up to 12.5 million shares to current GTI shareholders under the IPO.
The newly listing company’s priority offer will open on May 10, 2022, and close on May 31, 2022, at 5:00 pm (AWST).
To participate, GTI shareholders should follow instructions set out in the priority offer application form, available from Tuesday, May 10, 2022, on the Regener8 website.
State of US uranium market
GTR holds uranium assets in both the Henry Mountains of Utah and the Great Basin Divide in Wyoming, US.
The company is aggressively exploring the properties in an effort to capitalise on the heating uranium market in the US, which until late last year was flat with little upward momentum.
The uranium price has risen 78% since August last year, adding more than US$20 per pound to the market price and dramatically improving the economics of uranium mining.
A report from Azarius Capital, an asset management company, predicts that uranium will continue to climb into 2023; “As fantastic as 2021 was for our bullish uranium thesis, we believe the evidence points to the uranium market reaching a dramatic crescendo in 2022 lasting through at least 2023… our confidence in both the outcome and the timing is high.”