Uranium investment firm Yellow Cake PLC (AIM: YCA) announced today that it has garnered £103 million through the issuance of new ordinary shares on the AIM segment of the London Stock Exchange.
Established by Bacchus Capital Advisers, Yellow Cake was conceived with the purpose of maintaining long-term physical uranium reserves.
The company disclosed the sale of 18.7 million new ordinary shares to both new and prevailing institutional investors, which corresponds to approximately 9.4% of the existing issued ordinary share capital, each share priced at £5.50.
The CEO of Yellow Cake, Andre Liebenberg, attributed the “oversubscribed” nature of the placing partly to the escalating interest in uranium and the distinctive investment proposition of the company.
Uranium prices have experienced a significant uptick of nearly 40% since the beginning of the year, escalating to US$70 per pound, a pinnacle not witnessed since the Fukushima nuclear disaster in 2011.
Liebenberg remarked that the recent upward trajectory in uranium prices reflects the themes the company has persistently highlighted. The supply-demand fundamentals and the growing recognition of the vital role nuclear energy will assume in achieving net zero objectives are both serving as long-term catalysts, he said.
Liebenberg further commented that to fulfill demand, both spot and term prices must witness additional increments to reach a level that incentivizes the establishment of new greenfield mines.
Cantor Fitzgerald, Canaccord Genuity (TSX:CF, LSE:CF), and Berenberg, Gossler & Co. served as joint bookrunners for the placing, with Bacchus providing financial advisory services to the company.
