Canadian Uranium (TSX:CANU) expects to close its acquisition of the 94,118-hectare Carrot River Property in Saskatchewan, Canada, subject to regulatory approvals.
The company entered into a definitive sale and purchase agreement for a 100% legal and beneficial interest in the project, which comprises two mineral dispositions.
Total consideration is C$600,000 ($614,349) in cash and C$22 million in common shares. The share component represents about 71% of the company’s C$31.09 million market capitalisation, based on around 29.7 million shares on issue and a 9 November close of C$1.05.
Management says the acquisition “significantly advances our internal model of building a uranium project portfolio rivalling some of the great companies in the sector”.
“On the heels of the recent Rook 2 announcement, Carrot River becomes very complementary in securing a very large, highly prospective land package that we believe has the potential to define an entirely new uranium district. A rare opportunity in a world that urgently needs new sources of supply,” Canadian Uranium says.
The cash consideration is payable across three instalments: C$150,000 on signing, C$150,000 by 13 November 2026, and C$300,000 following Canadian Securities Exchange acceptance.
Consideration shares will be issued at closing at a price determined by the 10-day volume-weighted average price of the company’s stock. The vendors are subject to a 12-month contractual resale restriction, with shares released in four equal 25% tranches at four months and one day, six months, nine months, and 12 months post-closing.
The vendors retain a 2% net smelter return royalty and a 10% carried interest that remains non-participating until commercial production starts, at which point it converts to a participating interest. The vendors will also receive a board nomination right at closing.
Canadian Uranium is an emerging uranium explorer and developer initially focused on building a portfolio in the Athabasca Basin.
Write to Paula Fabe at Mining.com.au
Main image: Canadian Uranium
