TORONTO (miningweekly.com) – Uranium giant Cameco Corporation moved on Monday to calm market speculation regarding the potential sale of its 49% stake in Centerra Gold.
Shares in Centerra fell more than 9% on Monday, after the Globe and Mail newspaper reported that Cameco had hired investment banks to sell the shares, likely through a prospectus filed with securities regulators.
Cameco has hired RBC Dominion Securities and CIBC World Markets for the sale, and wants to realise at least C$6 a share, the newspaper said, citing unnamed sources.
“There are no undisclosed material developments related to the progress of divesting the company's interest in Centerra Gold,” Cameco said on Monday afternoon.
“Contrary to speculation, the company is not working with underwriters to draft a preliminary prospectus,” the firm said, in a statement issued at the request of Investment Industry Regulatory Organisation of Canada.
Cameco, which spun out its gold assets into Centerra in 2004, has made no secret that it plans to sell the shares as soon as it can get a decent price, but had been waiting for the gold miner to conclude an investment agreement with the government of Kyrgyzstan, for its Kumtor mine in that country.
The ownership agreement, which gave the Kyrgyz government an increased share in Centerra, was concluded in April this year.
Centerra also has a gold mine in Mongolia, but the operation was interrupted in May, first by a strike and then because a key licence was suspended by the government.
The strike ended in June, however, and Centerra announced late last month that the permit had been reinstated.
Shares in Centerra fell 9,1% on Monday, to C$6,51 apiece by 15:59 in Toronto.
Cameco slipped 0,3%, to C$30,20 a share.