Denison Mines Corp. (TSX: DML) announced today that it has entered a binding agreement with UEX Corporation (TSX: UEX) to acquire 50% ownership of JCU (Canada) Exploration Company for $20.5 million. The transaction will follow UEX’s expected 100% acquisition of JCU Canada from Overseas Uranium Resources Development Co., Ltd.
Denison Mines previously sent an offer to Overseas Uranium to acquire 100% of JCU Canada for $40.5 million, although this was conditional on the termination of the prior definitive purchase agreement between UEX and Overseas Uranium.
UEX and Overseas Uranium have recently amended the purchase agreement, which now sees UEX acquiring 100% of JCU Canada from Overseas Uranium for $41 million.
The binding agreement between Denison Mines and UEX includes a provision of an interest-free three-month term loan of up to $41 million to facilitate UEX’s 100% acquisition of JCU Canada. The $20.5 million from this loan will be considered repaid to Denison Mines in exchange for 50% of JCU Canada shares. The other half of the JCU Canada shares will also be held by Denison Mines as security until the loan is fully paid.
UEX’s acquisition of JCU Canada will be subject to Overseas Uranium’s stockholders’ approval on June 18, 2021. Should this be approved, the acquisition is expected to close on August 3, 2021.
Currently, JCU holds a portfolio of joint venture interests in Canada, including a 10% interest in Denison’s 90%-owned Wheeler River uranium project.
Denison Mines Corp. last traded at $1.64 on the TSX.
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