Uranium One buys 50 percent of Karatau mine

energy

Uranium One buys 50 percent of Karatau mine

By SRI ⋅ December 16, 2009 ⋅

(SRI) - Uranium One, a Canadian uranium producer, has closed its acquisition of 50 percent of the Karatau Uranium Mine in Kazakhstan for $420 million from Russian state-owned uranium miner Atomredmetzoloto (ARMZ).

The two companies signed an agreement that will allow ARMZ to hold an indirect 19.9-percent interest in Uranium One in June.

The purchase price includes the issuance of 117 million common shares of Uranium One, representing a 19.9-percent stake of the company, and a promisory note of $90 million due not later than 12 months from closing. This reportedly values the transaction at about $420 million. The agreement also provides for a contingent payment to ARMZ of up to $60 million to be paid over three years depending on the tax regime in Kazakhstan.

The other 50-percent interest in the mine is held by the Kazakh national uranium company Kazatomprom, which also holds joint venture interests in Uranium One’s other Kazakh mines and projects.

Uranium One reportedly expects the mine to produce up to 2.6 million pounds a year when it reaches full production in 2010.