The Australian uranium producer’s output would be third globally, behind Kazatomprom and Cameco Corp.
“We think there’s a fantastic opportunity to provide a really substantial global alternative to Cameco with this deal,” said Purdy, who visited Canada this week to meet federal government officials about the proposal.
Combining companies would make it easier to attract investors and raise the likelihood that Fission’s Patterson Lake South project is completed by the end of the decade, Purdy said. He expects to fund construction of Fission’s $1.2 billion project by cash generated from Paladin’s Langer Heinrich operation in Namibia as well as through traditional financing, including debt and offtake agreements.
Paladin’s agreement last month to buy Fission in a $1.14 billion all-stock deal marks the first significant sign of consolidation in a sector that has been revived by global demand for nuclear energy. While uranium prices have rallied as supply concerns escalate and countries reconsider nuclear power as a way to cut carbon emissions, just a handful of companies offer investors exposure to the nuclear reactor fuel.
The chief executive estimates that Perth, Australia-based company will increase its market value after acquiring Fission, giving the combined company greater financial heft to pursue its objectives.
“We’ve got strong relationships in the debt market and obviously, being a $5 billion company, we’ll be able to attract different forms of finance that Fission wouldn’t have been able to attract as an independent, small company,” Purdy said.
Paladin’s deal requires approval from Canada’s federal government, which has increased scrutiny on critical minerals deals involving foreign buyers. Purdy said he received a positive response from government officials Tuesday when he visited Ottawa to discuss the proposal. The company expects the takeover to close in September.
With assistance from Geoffrey Morgan.