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VANCOUVER - enCore Energy Corp. [EU-TSXV; ENCUF-OTCQB:ENCUF] and Azarga Uranium Corp. [AZZ-TSX; AZZUF-OTCQB; P8AA-AZZUF] have entered into a definitive arrangement agreement whereby enCore will acquire all of the issued and outstanding common shares of Azarga pursuant to a court-approved plan of arrangement.
The transaction consolidates an industry leading pipeline of exploration and development staged in-situ recovery focused uranium projects located in the United States, including the licensed Rosita and Kingsville Dome past producing uranium production facilities in South Texas, the advanced stage Dewey Burdock development project in South Dakota, which has been issued its key federal permits, the PEA-staged Gas Hills Project located in Wyoming, and a portfolio of resource staged projects throughout the United States. The combined company will possess a uranium resource base of 90.0 million pounds in the measured & indicated category, 9.9 million pounds in the inferred category, as well as 68.4 million pounds in the historic category.
Under the merger terms, Azarga shareholders will receive 0.375 common shares of enCore for each Azarga common share held. The Exchange Ratio implies consideration of $0.71 per Azarga common share based on the closing price of the enCore common shares on the TSX Venture Exchange on September 3, 2021.
Additionally, the exchange ratio will be subject to an adjustment mechanism at the closing of the transaction. The closing exchange ratio shall be equal to the greater of the exchange ratio; or an exchange ratio calculated as $0.54 divided by enCore's 15-day volume-weighted average price prior to the closing of the transaction, subject to a maximum closing exchange ratio of 0.49 common shares of enCore for each share of Azarga outstanding.
The merger will create a top-tier American uranium ISR mining company with multiple assets at various stages of development and will have two licensed ISR production facilities and multiple potential satellite exploration and development projects in South Texasand an advanced stage Dewey Burdock development project in South Dakota with key federal permits issued.
There is a recently published PEA for the Gas Hills project in Wyoming. There is a large uranium resource endowment in New Mexico, including the Marquez-Juan Tafoya project, for which a recent PEA was published and the Crownpoint and Hosta Butte project.
The surviving entity is well positioned to benefit from America's nuclear renaissance, which boasts bi-partisan political support. The management team and board has unrivaled experience in the permitting, development, and mining of ISR uranium deposits in the USA.