It looks like the Sprott Physical Uranium Trust (TSX: U.UN) is looking to capitalize on recent positive sentiment. The fund this morning, by way of Sprott Asset Management, announced that it would be conducting a massive US$1.0 billion at-the-market financing to raise further funds.
The financing follows a previously announced ATM program, whereby the firm looked to raise US$300 million, under a program that commenced August 17. Evidently it was so successful, that there was justification to conduct another program, this time for over three times the size.
Units under the program will be sold directly on the Toronto Stock Exchange in Canada, with the program being facilitated by both Cantor Fitzgerald and Virtu ITG Canada.
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While it was not stated within this mornings release, funds from the offering are suspected to be used for the same purposes of the last financing, which is to, “increase the scale and liquidity of the Trust through regular purchases of physical uranium on the open market.” The company indicated previously that the raising of funds via an ATM is the most cost effective and unitholder friendly method to do so.
The Sprott Physical Uranium Trust is a close-ended trust that was established by Sprott Asset Management to invest and hold its physical uranium assets, of which it has roughly US$1.13 billion in net assets. The Trust is believed to be at least partially responsible for the recent run-up in uranium pricing.
The Sprott Physical Uranium Trust last traded at $18.45 on the TSX.
Information for this briefing was found via Sedar and the companies mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
