enCore Energy Corp. and Azarga Uranium Corp. have entered into a definitive arrangement agreement whereby enCore will acquire all of the issued and outstanding common shares of Azarga, pursuant to a court-approved plan of arrangement.
The transaction consolidates an industry leading pipeline of exploration and development staged in-situ recovery (ISR) focused uranium projects located in the US, including: the licensed Rosita & Kingsville Dome past producing uranium production facilities in South Texas; the advanced stage Dewey Burdock development project in South Dakota, which has been issued its key federal permits; the PEA-staged Gas Hills Project located in Wyoming; and a portfolio of resource staged projects throughout the US. The combined company will possess a uranium resource base of 90.0 million lbs in the measured and indicated category, 9.9 million lbs in the inferred category, as well as 68.4 million lbs in the historic category.
Under the terms of the agreement, Azarga shareholders will receive 0.375 common shares of enCore for each Azarga common share held. The exchange ratio implies consideration of US$0.71 per Azarga common share based on the closing price of the enCore common shares on the TSX Venture Exchange on 3 September 2021.
Additionally, the exchange ratio will be subject to an adjustment mechanism at the closing of the transaction. The closing exchange ratio shall be equal to the greater of: (i) the exchange ratio, or (ii) an exchange ratio calculated as US$0.54 divided by enCore’s 15-day volume-weighted average price prior to the closing of the transaction, subject to a maximum closing exchange ratio of 0.49 common shares of enCore for each share of Azarga outstanding.
- Creation of a top-tier American uranium ISR mining company with multiple assets at various stages of development.
- Two licensed ISR production facilities and multiple potential satellite exploration and development projects in South Texas.
- Advanced stage Dewey Burdock development project in South Dakota with key federal permits issued.
- Recently published preliminary economic assessment for the Gas Hills project in Wyoming.
- Large uranium resource endowment in New Mexico, including the Marquez-Juan Tafoya project, for which a recent preliminary economic assessment was published and the Crownpoint and Hosta Butte project.
- Well positioned to benefit from America’s nuclear renaissance, which boasts bi-partisan political support.
- Management team and board with unrivalled experience in the permitting, development, and mining of ISR uranium deposits in the US.
Paul Goranson, CEO of enCore, comments:
“enCore is delighted to combine our assets with those of Azarga. Dewey Burdock is an excellent ISR uranium project and we look forward to building upon Azarga’s successes to create additional value through development progress and eventually production. In addition to the execution of plans for near term production in Texas and a dominant mineral position in New Mexico, this combination will see enCore take another leap forward towards realising the goal of becoming a larger and more diversified uranium development company during a time of positive sentiment for nuclear energy.”
Blake Steele, President & CEO of Azarga, comments:
“We are pleased to partner with enCore as a result of this transaction, while realising a material premium for shareholders in the process. Scale is important in the natural resource sector and this transaction will position the new company among the top uranium miners based in the US. enCore possesses a great depth of uranium development and mining experience within its management team and board of directors. As such, we are confident that the combined portfolio will be in good hands for the benefit of both sets of shareholders.”
William Sheriff, Executive Chairman of enCore, comments:
“This strategic acquisition fills the gap in enCore’s pipeline of projects with key intermediate development opportunities in Wyoming and South Dakota, in between initial production in Texas and longer-term opportunities in New Mexico. This second major acquisition for enCore within the last 12 months is in keeping with our announced aggressive M&A strategy which was successfully employed at Energy Metals Corp, which was sold for US$1.6 billion during the last cycle. Consolidation in conjunction with an elite operational team are the keys to success in building a leading US ISR company.”
Read the article online at: https://www.globalminingreview.com/mining/13092021/encore-energy-and-azarga-uranium-to-combine/