NYSE American: UEC
More than 38% of eligible UEX
securities have already been tendered, as of this press release,
with an overwhelming 93.7% voting in favour of the UEC
transaction.
UEC offer of C$0.49 per UEX share is financially superior to
the Acquisition Proposal submitted by Denison.
CORPUS
CHRISTI, Texas, Aug. 5, 2022
/CNW/ - Uranium Energy Corp. (NYSE American: UEC) (the
"Company" or "UEC") announces that, further to its
news release of July 28, 2022, it has
advised UEX Corporation ("UEX") that it is submitting a
superior offer to the acquisition proposal made by Denison Mines
Corp. ("Denison") on
July 28, 2022 (the "Denison
Proposal") for all of the issued and outstanding shares of UEX
("UEX Shares").
Under the terms of UEC's revised offer (the "Revised UEC
Offer"), each holder of UEX Shares will now receive 0.0890
of one common share of UEC (a "UEC Share") for each UEX
Share held, implying consideration of approximately C$0.49 per UEX Share based on the closing price
of UEX Shares and UEC Shares on the Toronto Stock Exchange and the
NYSE American Exchange, respectively, and the spot exchange rate as
of August 5, 2022. The Revised
UEC Offer also increases the break fee by 7%, which is an increase
proportional to the percentage increase in the offered exchange
ratio under the Revised UEC Offer.
Amir Adnani, President and CEO,
stated: "After careful analysis and consideration, we firmly
believe the Revised UEC Offer represents a value-creating
opportunity for UEC and UEX shareholders. We remain disciplined
with respect to pursuing accretive growth and the Revised UEC Offer
strikes a balance of a modest increase in the exchange ratio while
doubling UEC's uranium resources1 at only a 14.2%
dilution to our outstanding shares. This transaction highlights
UEC's sector leading strategy as the fastest growing, pure play,
100% unhedged uranium company and will create the largest,
diversified North American focused uranium company. Finally, a true
testament to the win-win industrial logic of the transaction is the
overwhelming positive support for our deal, as evidenced with over
38% of eligible UEX securities tendered with over 93.7% voted in
favor, and the positive share price performance for UEC. With
an offer that is superior to the Denison Proposal in all respects,
we look forward to completing this transaction following the UEX
shareholder vote next week."
If the board of directors of UEX (the "UEX Board")
accepts the Revised UEC Offer, UEC expects that the special meeting
of UEX securityholders to approve UEC's acquisition of the UEX
Shares based on the Revised UEC Offer will continue to be held as
currently scheduled on Tuesday August 9,
2022, with an anticipated closing date (subject to court
approval and the satisfaction or waiver of closing conditions
customary for a transaction of this nature) by mid-August.
The Revised UEC Offer is superior to the Denison Proposal in all
respects:
- Superior Financial Consideration. The Revised UEC Offer
values UEX at C$0.49 per UEX Share, a
7% improvement over the original exchange ratio and higher
financial consideration than the Denison Proposal based on closing
prices of the shares and the spot exchange rate as at August 5, 2022. The Revised UEC Offer reflects a
premium of 72% over the unaffected UEX Share price on June 10, 2022 (being the last trading day prior
to the announcement of UEC's proposed acquisition of UEX).
- Stronger Deal Certainty. As part of its Revised UEC
Offer submission to the UEX Board, UEC has provided UEX with a
simple amending agreement to the original arrangement agreement
dated June 13, 2022, as amended
June 23, 2022, among UEX, UEC and UEC
2022 Acquisition Corp. (the "Arrangement Agreement") to
reflect the Revised UEC Offer. By its own admission,
Denison has characterized its
proposal as "non-binding" and "remains subject to the
entering into of a definitive agreement"2. Upon
acceptance of the Revised UEC Offer by UEX, UEC will be firmly
bound to complete the Revised UEC Offer as soon as practicable.
- Quicker Path to Completion. UEX securityholders are
scheduled to vote on UEC's proposed acquisition of the UEX Shares
based on the Revised UEC Offer on Tuesday
August 9, 2022, with closing of the transaction (subject to
court approval and the satisfaction or waiver of closing conditions
customary for a transaction of this nature) anticipated within days
of the UEX securityholder vote. UEC understands that more than 38%
of eligible UEX securities have already tendered, as of this press
release, with an overwhelming 93.7% voting in favour of the UEC
transaction.
- Denison Proposal is Financially Inferior, Uncertain and
Remains Subject to the Negotiation of a Definitive Agreement.
The Denison Proposal remains subject to, among other things, the
negotiation of a definitive agreement, the preparation of an
information circular providing disclosure on the proposed
transaction, court and regulatory approvals, and the calling of a
new securityholders meeting to approve the transaction. As such, a
closing of any deal with Denison
is likely to take UEX shareholders well into Q4 2022.
- Larger Trading Liquidity. UEC benefits from a strong
institutional and retail following which has resulted in trading
liquidity that is more than 50%3 greater than that of
Denison. UEX shareholders, upon
exchange of their UEX Shares for UEC Shares based on the Revised
UEC Offer, will have a deeper pool to value and trade their
securities.
- UEC Maintains its Strong Balance Sheet With Over
$180 million of Cash and Liquid
Assets, with No Debt.
- The Opportunity to Create the Largest Diversified North
American Focused Uranium Company. UEX shareholders have an
opportunity to be part of UEC's fully permitted, production-ready
assets in the U.S., which is the largest market in the world for
uranium demand. UEC offers superior scale, as exhibited by its
larger capital markets presence, and a path for immediate re-rating
potential following a rapid timeline to closing of the
transaction.
It is the view of UEC, based on advice provided by its financial
and legal advisors, that the superior proposal notice delivered by
UEX to UEC on July 28, 2022 was
deficient in several respects. These deficiencies have been
communicated to UEX over the past few days, and have not, in our
view, been rectified. While we have elected to increase the
consideration offered in our proposed transaction, in making the
Revised UEC Offer we advised UEX we were reserving all rights to
require UEX to comply with the right to match provisions in the
Arrangement Agreement, including, among other things, that the
right to match period has not yet commenced.
The Revised UEC Offer expires at 7:00
p.m. (Vancouver time) on
the date of this press release, coinciding with the termination of
the right to match period under the Arrangement Agreement. Upon a
determination by the UEX Board that the Revised UEC Offer is at
least equivalent to the Denison Proposal, UEX is required to enter
into an amending agreement to the Arrangement Agreement to reflect
the Revised UEC Offer.
About Uranium Energy
Corp
Uranium Energy Corp is America's leading, fastest growing,
uranium mining company listed on the NYSE American. UEC is a pure
play uranium company and is advancing the next generation of
low-cost, environmentally friendly In-Situ Recovery (ISR) mining
uranium projects. The Company has two production ready ISR hub and
spoke platforms in South Texas and
Wyoming, anchored by fully
licensed and operational processing capacity at the Hobson and Irigaray plants. UEC also has seven
U.S. ISR uranium projects with all of their major permits in
place. Additionally, the Company has other diversified
holdings of uranium assets, including: (1) one of the largest
physical uranium portfolios of U.S. warehoused
U3O8; (2) a major equity stake in the only
royalty company in the sector, Uranium Royalty Corp.; and (3) a
pipeline of resource-stage uranium projects in Arizona, Colorado, New
Mexico and Paraguay. The Company's operations are
managed by professionals with a recognized profile for excellence
in their industry, a profile based on many decades of hands-on
experience in the key facets of uranium exploration, development
and mining.
Twitter: @UraniumEnergy
Stock Exchange Information:
NYSE American: UEC
Frankfurt Stock Exchange Symbol: U6Z
WKN: AĆJDRR
ISN: US916896103
Safe Harbor Statement
Except for the statements of historical fact contained herein,
the information presented in this news release constitutes
"forward-looking statements" as such term is used in applicable
United States and Canadian laws.
These statements relate to analyses and other information
that are based on forecasts of future results, estimates of amounts
not yet determinable and assumptions of management. Any other
statements that express or involve discussions with respect to
predictions, expectations, beliefs, plans, projections, objectives,
assumptions or future events or performance (often, but not always,
using words or phrases such as "expects" or "does not expect", "is
expected", "anticipates" or "does not anticipate", "plans,
"estimates" or "intends", or stating that certain actions, events
or results "may", "could", "would", "might" or "will" be taken,
occur or be achieved) are not statements of historical fact and
should be viewed as "forward-looking statements". Such forward
looking statements involve known and unknown risks, uncertainties
and other factors which may cause the actual results, performance
or achievements of the Company to be materially different from any
future results, performance or achievements expressed or implied by
such forward-looking statements. Such risks and other factors
include, among others, market and other conditions, the actual
results of exploration activities, variations in the underlying
assumptions associated with the estimation or realization of
mineral resources, the availability of capital to fund programs and
the resulting dilution caused by the raising of capital through the
sale of shares, accidents, labor disputes and other risks of the
mining industry including, without limitation, those associated
with the environment, delays in obtaining governmental approvals,
permits or financing or in the completion of development or
construction activities, title disputes or claims limitations on
insurance coverage. Although the Company has attempted to identify
important factors that could cause actual actions, events or
results to differ materially from those described in
forward-looking statements, there may be other factors that cause
actions, events or results not to be as anticipated, estimated or
intended. There can be no assurance that such statements will prove
to be accurate as actual results and future events could differ
materially from those anticipated in such statements. Accordingly,
readers should not place undue reliance on forward-looking
statements contained in this news release and in any document
referred to in this news release. Certain matters discussed in this
news release and oral statements made from time to time by
representatives of the Company may constitute forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act of 1995 and the Federal securities laws. Although the
Company believes that the expectations reflected in such
forward-looking statements are based upon reasonable assumptions,
it can give no assurance that its expectations will be achieved.
Forward-looking information is subject to certain risks,
trends and uncertainties that could cause actual results to differ
materially from those projected. Many of these factors are beyond
the Company's ability to control or predict. Important factors that
may cause actual results to differ materially and that could impact
the Company and the statements contained in this news release can
be found in the Company's filings with the Securities and Exchange
Commission. For forward-looking statements in this news release,
the Company claims the protection of the safe harbor for
forward-looking statements contained in the Private Securities
Litigation Reform Act of 1995. The Company assumes no
obligation to update or supplement any forward-looking statements
whether as a result of new information, future events or otherwise.
This press release shall not constitute an offer to sell or the
solicitation of an offer to buy securities.
______________________________________________________________
1 Subject to the completion of technical report
summaries by UEC following closing of the proposed acquisition of
UEX.
2 Denison press
release dated July 29, 2022.
3 Based on average daily traded volume over the last
12 months.
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SOURCE Uranium Energy Corp