Junior Uranium Companies: We're Not For Sale

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...On Tuesday, the Financial Times [UK] reported that investors wanting high-quality exposure to the uranium bull market are basically limited to buying shares in Cameco Corp...

James Finch submits: On the heels of SXR Uranium One’s announcement to acquire UrAsia Energy, one might conclude this could spawn the beginning of widespread consolidation in the uranium sector. In the early morning hours after the $5 billion deal was announced, SXR Uranium One chief executive Neal Froneman emailed us writing, “Our focus on the U.S. has not changed.” In previous interviews, Mr. Froneman has kindly been transparent in discussing his intentions to not only build up his uranium assets in the United States, but to pursue a senior stock exchange listing, presumably the New York Stock Exchange.

On Tuesday, the Financial Times [UK] reported that investors wanting high-quality exposure to the uranium bull market are basically limited to buying shares in Cameco Corp. (CCJ) Froneman told the newspaper, “The new Uranium One will provide an alternative to Cameco.” He’s right, but there are also two mid-size uranium producers – Denison Mines and Paladin Resources – with sufficient market capitalization to acquire one or more of the smaller uranium juniors. Widely respected Justin Reid, uranium analyst at Sprott Securities, told the Financial Times, “for them to retain market share, they have to do something aggressively, and they have to do it now.”

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