London Stock Exchange welcomes Yellow Cake plc to AIM
Yellow Cake plc (“Yellow Cake” or the “Company”), founded and established by Bacchus Capital as a specialist company to operate in the uranium sector and hold long term physical uranium (“U3O8”), opened the markets at the London Stock Exchange as it celebrated the successful listing of its Ordinary Shares on AIM.
Following an oversubscribed book-build at the top end of the anticipated offer range, the Company has raised approximately £150 million, one of the largest capital raises on AIM this year.
Yellow Cake will use its expertise to generate value with a strategy founded upon the long-term ownership of physical U3O8, alongside a range of activities and opportunities connected with owning physical U3O8, such as; the trading of U3O8, optimisation of logistics associated with the trading of U3O8, generating revenue from the lending of physical U3O8 and uranium-based financing initiatives such as commodity streaming and royalties.
Yellow Cake has entered into a long-term supply contract with JSC National Atomic Company Kazatomprom (“Kazatomprom”), one of the world’s largest and understood to be one of the lowest cost producers of uranium. Following today’s successful admission, the Company will now purchase c. US$170 million of U3O8 (representing roughly 25% of Kazatamprom’s annual production or 5% of the global marketed production of U3O8 in 2016) under the contract, which will be stored in the Port Hope and Blind River facilities operated by Cameco Corporation in Canada. Under the agreement with Kazatomprom, Yellow Cake will acquire this U3O8 at an average price of approximately US$21 per lb, thereby generating an initial physical position of approximately 8.1 million lbs.
Peter Bacchus, Chair & Chief Executive of Bacchus Capital said;
“The highly successful initial public offering of Yellow Cake demonstrates the depth and breadth of interest in uranium as a commodity and reflects the U.K. market’s continued support for the natural resources sector when an opportunity presented is on-theme, clearly articulated and compelling in nature. I would like to offer Andre and his highly credentialed team my best wishes for the future.”
Andre Liebenberg, CEO of Yellow Cake, said;
“Due to an exceptional confluence of events, uranium is one of the few commodities yet to recover from the recent commodities bear market. We believe that uranium is fundamentally and structurally mispriced in the current market, and on a historical basis.
Yellow Cake’s long-term supply contract with Kazatomprom has allowed us to secure a highly significant and strategic position in physical uranium, at a competitive price, and to offer that exposure to a potential resurgence in the uranium price to investors, while avoiding direct exposure to exploration, development, mining and processing risk.
I am delighted to welcome our new shareholders to Yellow Cake.”