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Denison to buy uranium explorer Fission for about C$483m

Exploration at Fission Uranium's Patterson Lake South Project, in Northern Saskatchewan.

Exploration at Fission Uranium's Patterson Lake South Project, in Northern Saskatchewan.

Photo by Fission Uranium

7th July 2015

By: Henry Lazenby

Creamer Media Deputy Editor: North America

  

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TORONTO (miningweekly.com) – Canadian uranium exploration and development company Denison Mines has agreed to buy rival Fission Uranium for about C$483-million, creating a new diversified Canadian uranium company with a portfolio of projects in the prolific Northern Saskatchewan mining region.

Denison advised on Monday that, under the terms of the deal, Fission shareholders would receive 1.26 Denison shares for each Fission share held plus C$0.0001 a share in cash.

The offer implied a price of C$1.25 a Fission share, an 18% premium to the average volume-weighted price of Fission's shares over the past 30 days. With some 386.23-million shares outstanding, the offer translates into a price of about C$483-million for Fission.

Following the merger, the new entity would be named Denison Energy, have a market value of about C$900-million and be equally owned by Denison's and Fission's shareholders.

"This merger will create the uranium industry's leading exploration and development company at a time when the sector is poised for growth," Fission chairperson and CEO Dev Randhawa said in a statement. He would become CEO of the combined company.

Headlining the asset portfolio of the combined company would be two world class uranium exploration and development projects, including Fission's Patterson Lake South project,and Denison's 60%-owned Wheeler River project, both located in the prolific Athabasca basin.

An emerging 15% supply gap could signal a prolonged upturn in the uranium price through to 2024, Canadian uranium major Cameco said recently. A decline in secondary sources of yellowcake was forcing the market to increasingly rely on primary suppliers, which, when coupled with unprecedented growth in the nuclear reactor industry, foretold improved market conditions over the medium and long term.

Edited by Tracy Klückow
Creamer Media Contributing Editor

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