Energy Fuels to Purchase Strathmore Minerals for $28.2 Million

Published on Sunday May 26 2013 (AEST)
  

On Friday 24th May, Energy Fuels Inc. and Strathmore Minerals Corp. announced the signing of a letter of intent which states that Energy Fuels will purchase Strathmore Minerals for $28.2 million, to create one of the largest uranium companies in the US.

Strathmore shareholders will receive 1.47 Energy Fuels shares for each share they own, equivalent to a 31% premium on Strathmore’s stock, based on closing prices at the end of trading on Thursday 23rd May.

Uranium companies have struggled to find cash after market values dropped this year following a decline in the price of uranium. Uranium fell to a seven year low on the 24th April, costing just $40.25 a pound, whereas in June 2007 it was at $138 a pound.
Energy Fuels believes that the acquisition will allow the exploitation of operational synergies between the two companies especially Energy Fuels’ White Mesa uranium mill and Strathmore’s Roca Honda project in New Mexico.


Stephen Antony, President and CEO of Energy Fuels was quoted in Energy Fuels press release as saying that,  

“it is rare to find an acquisition that offers the magnitude of synergies that we believe exist between Energy Fuels and Strathmore. I am very excited about the merits of this transaction and the opportunity it represents for the shareholders of both companies. It is consistent with our corporate strategy and significantly strengthens the company’s long-term production profile throughout the Four Corners region of the southwest U.S. and in Wyoming.   

 Strathmore is recognized for building a quality portfolio of U.S. uranium projects, and I look forward to working with them and their partners to realize the many synergies and to capitalize on the strengths that are created by this transaction.”

The US remains the largest consumer of uranium in the world, yet it still relies on imports to supply 90% of its requirements.  Energy Fuels is now well positioned to take advantage of this demand to its fullest.

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