Uranium developer Deep Yellow has secured binding commitments to raise N$2.7 billion through a placement to develop its Tumas Project in Namibia.
The Australia-based uranium developer Managing Director and CEO John Borshoff said the placement will see the issuance of 179,591,836 fully paid ordinary shares at A$1.225 (N$15.13) a piece.
“We are very pleased with the success of the placement raising A$220 million, buoyed by the overwhelming level of interest to participate, and would like to thank all existing and new investors for their support,” Borshoff said.
He added that the placement will be conducted in two tranches, with the second tranche awaiting shareholder approval.
“Under Tranche 1, the company looks to attract around A$140.5m through the issuance of 114,706,334 shares, while Tranche 2 will help garner around A$79.5m through the issuance of 64,885,502 shares,” he said.
Additionally, the company plans to raise A$30m (N$370 million) through an SPP to be offered to eligible Deep Yellow shareholders.
Borshoff noted that the significant interest in the placement and quantum of equity raised represents an important milestone in the development of Deep Yellow.
He said this presents an opportunity for the company to materially advance the Tumas Project and bring an important greenfield conventional uranium project into production within the next three years.
“This is the result of a consistently applied, focused 7-year strategy based on the foresight that the uranium supply squeeze currently being experienced was inevitable. This strategy has been supported by a proven, highly credentialed and experienced uranium team that has successfully assembled a relevant pipeline of geographically diverse projects through both organic and inorganic growth endeavours,” he said.
This comes as the Tumas project is expected to cost N$6 billion (US$360.5 million) according to re-costing study findings from N$7.3 billion (US$385.1 million) projected from the definitive feasibility study.
The re-costing study’s findings show that this will result in cost savings of N$458 million (US$24.6 million).
This comes as the Chamber of Mines welcomed the material recovery in the uranium price, which has breached the US$100/lb mark and is currently trading at US$106/lb, a price move that market analysts have been predicting since 2013.
