Paladin Energy has officially announced its acquisition of Fission Uranium, a deal valued at C$1.14 billion. This acquisition will create a major force in the industry with extensive assets spread across Canada, Namibia, and Australia. Ian Purdy, CEO of Paladin, highlighted the strategic nature of this acquisition, stating that it would deliver substantial benefits to shareholders of both companies through enhanced scale and capabilities. According to Purdy, this union represents a pivotal moment in the uranium industry, combining significant resources to establish one of the largest pure-play uranium entities worldwide.
The merger brings together a formidable total mineral resource of 544 million pounds of uranium oxide, along with ore reserves of 157 million pounds. Fission Uranium’s notable assets include the advanced-stage Triple R deposit at the Patterson Lake South (PLS) project in Canada’s Athabasca basin, which will now be integrated with Paladin’s robust portfolio.
“This acquisition is a natural fit for our portfolio,” noted Purdy. He added that the inclusion of PLS not only augments their Canadian operations but also positions them as a leading development hub in the region, complementing their Michelin project. Additionally, there’s significant exploration potential across all their Canadian properties. The feasibility study for the PLS project underscored its viability, forecasting a productive mine life of ten years with an annual output projected at 9.1 million pounds of uranium oxide.
Ross McElroy, President and CEO of Fission, expressed his support for the transaction, emphasizing the complementary nature of the synergy between Fission and Paladin’s culture and assets. McElroy also pointed out that this deal markedly reduces the financial risks associated with mine development at PLS, thanks to the cash flows from Paladin’s operational Langer Heinrich mine in Namibia and a robust balance sheet. He highlighted the strategic advantage of leveraging these resources to finance the PLS project development through debt and internally generated cash flows.
As per the terms of the agreement, each outstanding Fission share will be exchanged for a predetermined consideration, setting the implied value of each Fission share at C$1.30. Upon completion of the deal, the existing shareholders of Paladin and Fission will own approximately 76% and 24% of the enlarged entity, respectively.
In conjunction with the closing of this transaction, Paladin has also initiated steps to list its shares on the Toronto Stock Exchange (TSX). Notably, the completion of this transaction does not require approval from Paladin shareholders, streamlining the process toward finalizing the merger. This acquisition is set to reshape the uranium mining sector and enhance the combined entity’s capacity to meet growing global energy needs sustainably.
