Cameco Corp. (CCJ, CCO.TO), one of the world's largest uranium producer, Monday said it has agreed to acquire nuclear fuel broker Nukem Energy GmbH for 105 million euros, or $136 million.
Cameco will buy Nukem from Advent International and also assume Nukem's net debt of 127 million euros, or $164 million. Nevertheless, Cameco said it expects Nukem to significantly reduce the debt prior to closing with the help of cash generated from ongoing business. The acquisition is expected to close in the fourth quarter of 2012.
Following the closing, Germany-based Nukem will continue to operate as an independent company. The deal also provides a provision for Advent to get a share of Nukem's future earnings under certain conditions until the end of 2014.
Cameco Chief Executive Tim Gitzel said, "This acquisition complements Cameco's business by strengthening our position in nuclear fuel markets and improving our access to unconventional and secondary sources of supply. After closing, it is expected that Nukem will add solid cash flow and will have a positive impact on earnings starting in 2013."
In 2011, Nukem sold about 12 million pounds of uranium, and expects to sell 10 million to 15 million pounds in 2012.
CCJ is currently trading at $21.25, down $0.31 or 1.44%, on a volume of 1 million shares, on the NYSE.
On the Toronto stock exchange, Cameco is trading at C$21.26, down C$0.33 or 1.53%, on a volume of 0.4 million shares.
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