NexGen stock rises on $250m uranium purchase deal

NexGen
traded
4.6%
higher
at
C$11.00
at
12
pm
EDT.
The
company
has
a
market
capitalization
of
C$5.9
billion
($4.3bn).

In
a
binding
term
sheet,
NexGen
commits
to
issuing
$250
million
in
secured
convertible
debentures
to
MMCap
in
exchange
for
the
uranium
concentrate.
These
debentures
will
be
convertible
into
about
23
million
common
shares
of
NexGen,
equating
to
about
4.3%
of
the
company’s
issued
and
outstanding
common
shares.

“At
a
time
when
available
physical
uranium
is
extremely
tight
and
expected
to
continue
to
be
scarce
given
the
long-term
supply
deficit,
this
purchase
represents
a
strong
opportunity
for
the
company
to
bolster
its
marketing
discussions
and
optimizes
the
optionality
of
project
financing
structures
under
evaluation,”
NexGen
CEO
Leigh
Curyer
said
in
a
news
release.

NexGen’s
main
development
focus
is
the
Rook
I
project,
hosting
the
Arrow
discovery
from
2014,
considered
to
be
the
largest
development-stage
uranium
deposit
in
Canada.

In
November
2023,
the
company obtained
environmental
approval for
the
proposed
mine,
making
it
the
first
approved
greenfield
uranium
development
in
20
years.
Permitting
to
construct
the
underground
mine
and
mill
is
underway.

Rook
I
would
produce
21.7
million
lb.
of
uranium
oxide
annually
over
11
years
from
the
Arrow
deposit,
according
to
a
2021
feasibility
study.
Last
month,
the
company
said
it
had
found
a
new
deposit
3.5
km
east
of
Arrow.

The
Athabasca
Basin
is
one
of
the
world’s
leading
sources
of
uranium
production.