The price of physical uranium is on a tear, hitting its highest levels in over a decade.
And it’s ushering in a bull market for publicly listed uranium companies.
What’s happening:
- Physical spot uranium is at its highest price in more than a decade
Why it matters:
- There is a race for nuclear energy infrastructure underway being driven by global governments which is causing the demand for uranium to soar
- Nuclear energy has enormous promise as a low emission, carbon free source of power for the future
- Physical uranium is a foundational aspect of nuclear power and there is a growing dislocation between supply and demand
Who is making moves:
- Yellow Cake (AIM: YCA) raised £103M in a oversubscribed financing to continue buying up physical uranium
- Sprott Physical Uranium Trust (TSX: U-U) has filed a $125M CAD capital raise in order to purchase more physical uranium
- NexGen Energy (NYSE: NXE) closed a $110M USD to fund exploration and development of their properties in the Athabasca Basin in Saskatchewan
Going deeper:
- IsoEnergy (TSXV: ISO) just announced a merger with Consolidated Uranium (TSXV: CUR) to create one of the largest uranium companies in the world with projects in Canada and mines in the United States
- After announcing the merger, IsoEnergy launched a $35M CAD financing
- This is the first major merger and acquisition play for uranium public companies and could be a signal that more consolidation is coming with rising uranium spot prices
The fine print:
- Many publicly traded uranium companies have been under funded over the past few years due to the prices of physical uranium and are now racing to find growth capital
- In the public markets many uranium companies are early stage explorers who are yet to find a major discovery and need to raise funding based largely on speculation
