Highlights
- Uranium Royalty Corp (URC) is exercising its option to purchase
US$10 million of physical uranium,
secured under its strategic and foundational investment in the 2018
IPO of Yellow Cake plc (YCA);
- Initial tranche to be exercised by URC to acquire 348,068
pounds of U3O8 at US$28.73 per pound for delivery on or before
April 30, 2021;
- The acquisition provides URC with direct physical
U3O8 holdings at an opportunistic price,
which is ~7% below the most recent spot price published by
TradeTech on March 29, 2021 of
US$30.75 per pound; and
- Together with our recently announced proposed acquisitions of
royalty interests in the McArthur River and Cigar Lake mines, URC
is ideally positioned to benefit from improving uranium
prices.
VANCOUVER, BC, March 30, 2021 /CNW/ - Uranium Royalty
Corp. (TSXV: URC) ("URC" or the "Company") announces the
exercise of its option to acquire 348,068 pounds of
U3O8 pursuant to its existing strategic
arrangements with Yellow Cake plc ("Yellow Cake") at a price of
US$28.73 per pound. The Company
expects to complete the acquisition and take delivery of the
U3O8 on or before April 30, 2021.
Scott Melbye, Chief Executive
Officer of URC, commented: "We are pleased to announce this
exercise which gives URC an initial direct uranium stake at an
opportunistic price that is below the most recent spot price of
US$30.75 (TradeTech) in what has been
a strengthening uranium spot market. This decision is in line
with our goal of gaining exposure to uranium prices through
sector-focused investments and it clearly demonstrates the value of
our strategic Yellow Cake investment. In addition to this
optionality, we also hold a 5.9% stake in Yellow Cake, which itself
announced this month that it is acquiring an additional 3.9 million
pounds of U3O8, bringing its total holdings
to 13.2 million pounds (prior to our exercise)."
Mr. Melbye continued: "The addition of this direct physical
uranium interest further diversifies our unique uranium-focused
portfolio and adds a valuable asset to the balance sheet. As of
March 29, 2021, we have approximately
$46 million in cash and listed
securities. Together with our recently announced proposed
acquisitions of royalty interests in the McArthur River and Cigar
Lake mines, we believe we are uniquely positioned to benefit from
further improvements in the uranium market."
The acquisition is being completed pursuant to the option
granted to the Company in connection with its 2018 IPO investment
in Yellow Cake. Pursuant to the option, the Company may acquire
between US$2.5 million and
US$10 million of
U3O8 per year from Yellow Cake between
January 1, 2019 and January 1, 2028, up to a maximum aggregate amount
of US$31.25 million worth of
U3O8. Yellow Cake is a listed uranium
holding company that purchases U3O8 through
the spot market and a long-term supply agreement with National
Atomic Company Kazatomprom JSC.
About Uranium Royalty Corp.
Uranium Royalty Corp. (URC) is a pure-play uranium royalty
company focused on gaining exposure to uranium prices by making
strategic investments in uranium interests, including royalties,
streams, debt and equity investments in uranium companies, as well
as through holdings of physical uranium. The Company recognizes the
inherent cyclicality of valuations based on uranium prices,
including the impact of such cyclicality on the availability of
capital within the uranium sector and the current historically low
uranium pricing environment. URC intends to execute on its strategy
by leveraging the deep industry knowledge and expertise of its
management team and the Board to identify and evaluate investment
opportunities in the uranium industry. The Company's management and
the Board include individuals with decades of combined experience
in the uranium and nuclear energy sectors, including specific
expertise in mine finance, project identification and evaluation,
mine development and uranium sales and trading.
Forward Looking Statements
Certain statements in this news release may constitute
"forward-looking statements", including those regarding the
expected completion of proposed acquisitions and uranium markets.
Forward-looking statements are statements that address or discuss
activities, events or developments that the Company expects or
anticipates may occur in the future. When used in this news
release, words such as "estimates", "expects", "plans",
"anticipates", "will", "believes", "intends" "should", "could",
"may" and other similar terminology are intended to identify such
forward-looking statements. Forward-looking statements reflect the
current expectations and beliefs of the Company's management. These
statements involve significant uncertainties, known and unknown
risks, uncertainties and other factors and, therefore, actual
results, performance or achievements of the Company and its
industry may be materially different from those implied by such
forward-looking statements. They should not be read as a guarantee
of future performance or results, and will not necessarily be an
accurate indication of whether or not such results will be
achieved. A number of factors could cause actual results to differ
materially from such forward-looking statements, including, without
limitation, any inability to satisfy conditions to completion of
the Company's recently announced royalty acquisitions or to
complete any of the transactions as contemplated or at all, any
ability for the Company to obtain necessary financing on acceptable
terms or at all, risks inherent to royalty companies, uranium price
volatility, risks related to the operators of the projects
underlying the Company's existing and proposed interests and those
other risks described in the Company's Management's Discussion and
Analysis for the year ended April 30,
2020 and other disclosure documents, available on SEDAR
at www.sedar.com. These risks, as well as others, could cause
actual results and events to vary significantly. Accordingly,
readers should exercise caution in relying upon forward-looking
statements and the Company undertakes no obligation to publicly
revise them to reflect subsequent events or circumstances, except
as required by law.
Neither the TSX-V nor its Regulation Services Provider (as
that term is defined in policies of the TSX-V) accepts
responsibility for the adequacy or accuracy of this
release.
Website: www.UraniumRoyalty.com
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SOURCE Uranium Royalty Corp.