The $82.2-million deal may lead to more Chinese investment in Canadian uranium developers such as Denison Mines Corp. and Nexgen Energy Ltd., said Cantor Fitzgerald analyst Rob Chang. Canada is the world’s second biggest uranium-producing country after Kazakhstan.
Uranium prices have been weak since the 2011 Fukushima tsunami and meltdown in Japan led to that country shutting down its reactors. Prices are expected to rebound in coming years partly because of China’s aggressive construction of new reactors.
Fission shares rose 7.4 per cent, or 5 cents, to 73 cents in Toronto in late morning trading. The stock touched its highest price since early September.
Kelowna, B.C.-based Fission is developing the Triple R uranium deposit at Patterson Lake South in northern Saskatchewan. It and Denison called off a $483-million merger agreement in October due to opposition from Fission’s shareholders.
CGN agreed to pay 85 cents per share, a 25-per-cent premium to Fission’s Friday close, for a 19.99-per-cent stake in the company.
CGN, a uranium trader, is controlled by China Uranium Development Co. Ltd., a subsidiary of state-owned China General Nuclear Power Corp.
The Globe and Mail
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