It is exciting to see one of our long term shareholdings being acquired for a nice premium in the beaten down uranium sector, which has been a feeding ground for the shorts. For years, I have held Uranerz Energy (NYSE:URZ), a low cost uranium producer in Wyoming.
Uranerz shareholders should now see Energy Fuels shares in their account. They recently closed their transaction with Energy Fuels (AMEX:UUUU), who will now have the largest NI 43-101 compliant in ground resource in the US among current producers.
The stock recently made a bullish reversal after the close and the inclusion into the prestigious index. I expect a possible breakout into new 2015 highs and the 200 DMA at $5.60 later this summer as the uranium sector rebounds.
Stephen P. Antony, President and CEO of Energy Fuels stated:
“Our goal is to become the largest uranium mining company in the U.S., strategically supplying the domestic American nuclear power market, and this transaction is a major step towards achieving that goal.”
One of the goals of the merger was to have a larger size uranium company able to attract institutional capital. This thesis was proven correct as after the close, Energy Fuels was inducted into the Russell 3000 Index, which means they will automatically join the Russell 2000 Index.
Stephen P. Antony, President and CEO of Energy Fuels stated:
“Energy Fuels is delighted to join the Russell indexes. We are constantly striving to enhance our visibility in the marketplace, and I believe that inclusion in the Russell 3000® Index is a major achievement in this regard.”
Now with the Uranerz transaction closed, Energy Fuels will be in production in Wyoming and Utah and have the ability to ramp up as prices stabilize and increase. The US is the largest consumer of uranium in the world, with China playing catch up rapidly. Energy Fuels may now be the go to favorite for funds looking to enter this sector, which may be rebounding, as there are 66 reactors currently under construction.
Disclosure: Uranerz was a website sponsor. I am a shareholder of Energy Fuels. Conflicts of interest apply.