Yellow Cake seeks $125 million through share placement for uranium purchase

  • Stock Market News
Yellow Cake seeks $125 million through share placement for uranium purchase
Credit: © Reuters.

London-based Yellow (OTC: YELLQ ) Cake is planning to raise $125 million through a share placement at a 2.2% discount, aiming for GBP103 million. The announcement was made on Wednesday, with trading set to commence on October 2, 2023.

The CEO of Yellow Cake, Andre Liebenberg, has outlined plans to use the funds raised to purchase physical uranium from NAC Kazatomprom. The planned purchase price is $65.50 per pound, notably below the current spot price of $70.50 per pound. This move comes amid rising production costs and an increase in utilities restocking their uranium supplies.

In addition to the uranium purchase, the company intends to allocate extra funds towards working capital, corporate needs, and potential opportunistic purchases of additional uranium if opportunities arise.

Liebenberg highlighted the robust uranium market fundamentals as a driving factor behind this strategic move. "The strong uranium market fundamentals" were emphasized by him as a key reason for the company's decision to raise funds through share placement and invest in physical uranium.

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