Tuesday, 27 August 2013

Energy Fuels expects to close Strathmore transaction on Friday

Energy Fuels (TSE:EFR) provided Tuesday an update on its acquisition of Strathmore Mineral (TSE:STM) (OTCQX:STHJF), saying the deal is now expected to close on August 30 after receiving court approvals and other regulatory clearance within the last week. 
Last Wednesday, the company received approval from the Supreme Court of British Columbia, and today received a clearance letter from the Committee on Foreign Investment in the United States. 
Energy Fuels said in its press release Tuesday that as a result of these regulatory milestones, the company expects to close the deal at 11:59pm ET on August 30, subject to customary closing conditions. It had previously anticipated closing of the deal on August 28. 
Both companies say the transaction will position the newly combined Energy Fuels as the premier pure-play U.S. uranium company, supported by significant current uranium production of 1.175 million pounds for its current fiscal year, as well as a robust pipeline of development projects.
Toronto-based Energy Fuels, which has steadily grown its resource base, found an ideal fit with Strathmore, one of the largest holders of in-the-ground uranium in the U.S. The all-stock transaction combines Strathmore's Gas Hill assets in Wyoming with Energy Fuels' Sheep Mountain project, in close proximity, into a stand-alone production facility. 
Energy Fuels, the only conventional uranium producer in the U.S. that supplies approximately 25% of the uranium produced in the country, is offering 1.47 common shares to Strathmore investors for each share they hold. Strathmore shareholders will receive direct part in a revenue-generating uranium producer, while Energy Fuels says it will now be able to expand production at its White Mesa mill in Utah. 
While Energy Fuels is on track to produce 1.175 million pounds of uranium this year, chief executive officer Steve Anthony sees that ramping up to 3.5 to 4.0 million pounds per year.
Strathmore expects a permit by end of the year at Roca Honda in the Grants Uranium District of New Mexico. The company and Japanese partner Sumitomo believe Roca Honda is a "significant high-grade resource" within trucking distance of Energy Fuel's White Mesa mill, the only operating uranium mill in the U.S., which means substantial capital savings.

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