TORONTO, Aug. 9, 2022
/PRNewswire/ - Denison Mines Corp. ("Denison" or the
"Company") (TSX: DML) (NYSE American: DNN) has made a further
proposal (an "Acquisition Proposal") to acquire all of the issued
and outstanding shares of UEX Corporation ("UEX"). Under the terms
of the Acquisition Proposal, UEX shareholders would receive 0.32
shares of Denison in exchange for each share of UEX held, which
represents an implied purchase price of $0.51 per UEX share, on a spot basis, as of the
market close on August 8, 2022. View
PDF version.
Denison's Acquisition Proposal represents a 7% premium to the
price implied by the amended arrangement agreement between UEX and
Uranium Energy Corp. ("UEC") dated August 5,
2022 (the "Amended UEC Agreement") based on the one-day
volume weighted average price on August 8,
2022, and a 9% premium to the 20-day volume weighted average
price implied by the Amended UEC Agreement.
David Cates, President & CEO
of Denison, commented: "Following the expiration of our
previous acquisition proposal, which equated to a premium over the
Amended UEC Agreement on a 10- and 20-day volume weighted average
price basis, and after internal discussions, including with our
legal and financial advisors, Denison decided to make a further
premium acquisition proposal to UEX.
The success of this offer is subject to the board of UEX
determining that it is superior to the Amended UEC Agreement and is
also subject to UEC's five-day right to match. We note that on
August 5th, UEC increased
its offer in response to Denison's superior acquisition proposal of
July 22nd, and that the
UEX board of directors concluded that the amended terms offered by
UEC constituted a matching offer – despite the fact it implied a
lower UEX price from the perspective of premiums over normalized
trading periods.
In making this further offer, we recognize that UEC
remains in the 'driver's seat' through its right to match, and that
our offer may not ultimately prevail.
That said, we believe that the UEX assets are so
complementary to our own portfolio and Athabasca Basin specialization that it would
be short-sighted not to afford another opportunity for both Denison
and UEX shareholders to prosper from this combination."
In order for the UEX board of directors to consider if the
Acquisition Proposal constitutes a "Superior Proposal" under the
Amended UEC Agreement, UEX announced that it has postponed the
special meeting of UEX securityholders, originally scheduled for
August 9, 2022, to August 15, 2022.
Denison's Acquisition Proposal is conditional on UEX terminating
the Amended UEC Agreement, which will require the UEX board of
directors to assess (i) the Acquisition Proposal to be a "Superior
Proposal" and (ii) that UEC has failed to match in accordance with
the terms of the Amended UEC Agreement.
UEX has been provided with a set of definitive documents to give
effect to the Acquisition Proposal on a binding basis, and the
parties would be in a position to complete the transaction without
undue delay. After UEX determined that Denison's prior offer of
July 22, 2022 constituted a "Superior
Proposal" (as defined in the Amended UEC Agreement), UEX and
Denison negotiated and settled the terms of the necessary
agreements. Additionally, the definitive documents have already
been approved by the Denison board of directors.
As outlined previously, an acquisition of UEX by Denison has the
potential to yield multiple benefits:
- Consolidation of 100% ownership of Wheeler River –
Wheeler River is host to the high-grade Phoenix and Gryphon uranium deposits and
represents the largest undeveloped uranium project in the
infrastructure-rich eastern portion of the Athabasca Basin region. The Company is
actively advancing the Phoenix
deposit, which is proposed as a low-cost ISR mining operation,
through the environmental assessment and feasibility study
processes. The results from the Pre-Feasibility Study completed for
Wheeler River suggest that Phoenix
has the potential to be one of the lowest cost uranium mining
operations in the world. Denison currently has an effective 95%
interest in Wheeler River.
- Consolidation of 100% ownership of JCU (Canada) Exploration Company, Limited
("JCU") – JCU holds a portfolio of twelve uranium project
joint venture interests in Canada,
including a 30.099% interest in the Millennium project (Cameco
Corporation 69.901%), a 33.8118% interest in the Kiggavik project
(Orano Canada Inc. 66.1882%), and a 34.4508% interest in the
Christie Lake project (UEX 65.5492%). Denison currently has a 50%
ownership interest in JCU.
- Project portfolio suited to Denison's abundant in-house
expertise – Denison has a Saskatoon-based technical team with abundant
in-house expertise in the areas of exploration, project
development, engineering, metallurgy, mining, plant operations,
permitting and regulatory affairs, that is well suited to extract
the maximum value possible, for our shareholders, from uranium
exploration or development assets situated in the Athabasca Basin region.
While Denison is prepared to move ahead with the Acquisition
Proposal on an expedited basis, UEC retains its right to match
under the Amended UEC Agreement and there can be no assurance that
a definitive agreement or any other agreement relating to the
Acquisition Proposal will be entered into by UEX or that the
Acquisition Proposal, and any transactions related thereto or any
other similar transaction, will be approved or consummated by the
board or shareholders of UEX. The Company does not undertake any
obligation to provide any updates with respect to this or any other
transaction, except as required under applicable law.
About Denison
Denison is a uranium exploration and development company with
interests focused in the Athabasca
Basin region of northern Saskatchewan,
Canada. The Company has an effective 95% interest in its
flagship Wheeler River Uranium Project, which is the largest
undeveloped uranium project in the infrastructure rich eastern
portion of the Athabasca Basin
region of northern Saskatchewan. A
Pre-Feasibility Study was completed for Wheeler River in late 2018,
considering the potential economic merit of developing Phoenix as an ISR operation and the Gryphon
deposit as a conventional underground mining operation.
Denison's interests in Saskatchewan also include a 22.5% ownership
interest in the McClean Lake Joint Venture, which includes several
uranium deposits and the McClean Lake uranium mill, which is
contracted to process the ore from the Cigar Lake mine under a toll
milling agreement, plus a 25.17% interest in the Midwest Main and
Midwest A deposits and a 67.01% interest in the Tthe Heldeth Túé
('THT', formerly J Zone) and Huskie deposits on the Waterbury Lake
property. The Midwest Main, Midwest A, THT and Huskie deposits are
located within 20 kilometres of the McClean Lake mill. Denison's
exploration portfolio includes further interests in properties
covering approximately 300,000 hectares in the Athabasca Basin region.
Through its 50% ownership of JCU, Denison holds additional
interests in various uranium project joint ventures in Canada, including the Millennium project (JCU,
30.099%), the Kiggavik project (JCU, 33.8118%) and Christie Lake
(JCU, 34.4508%).
Denison is also engaged in post-closure mine care and
maintenance services through its Closed Mines group (formerly
Denison Environmental Services), which manages Denison's reclaimed
mine sites in the Elliot Lake
region and provides related services to certain third-party
projects.
Follow Denison on Twitter@DenisonMinesCo
Cautionary Statement Regarding
Forward-Looking Statements
Certain information contained in this news release
constitutes 'forward-looking information', within the meaning of
the applicable United States and
Canadian legislation concerning the business, operations and
financial performance and condition of Denison.
Generally, these forward-looking statements can be identified
by the use of forward-looking terminology such as 'plans',
'expects', 'budget', 'scheduled', 'estimates', 'forecasts',
'intends', 'anticipates', or 'believes', or the negatives and/or
variations of such words and phrases, or state that certain
actions, events or results 'may', 'could', 'would', 'might' or
'will be taken', 'occur', 'be achieved' or 'has the potential
to'.
In particular, this news release contains forward-looking
information pertaining to the following: the existence and terms of
the Acquisition Proposal, including the conditions and other rights
and obligations of the parties and any potential benefits of such a
transaction; UEX's announcement of the postponement of its
shareholder meeting and the anticipated date thereof; expectations
with respect to the terms of the Amended UEC Agreement and the
parties' rights and obligations thereunder; and expectations
regarding its joint venture ownership interests and the continuity
of its agreements with its partners.
Forward looking statements are based on the opinions and
estimates of management as of the date such statements are made,
and they are subject to known and unknown risks, uncertainties and
other factors that may cause the actual results, level of activity,
performance or achievements of Denison to be materially different
from those expressed or implied by such forward-looking statements.
For example, the conditions to the transactions may not be
satisfied or the parties may negotiate terms materially different
than disclosed herein. Denison believes that the expectations
reflected in this forward-looking information are reasonable and no
assurance can be given that these expectations will prove to be
accurate and results may differ materially from those anticipated
in this forward-looking information. For a discussion in respect of
risks and other factors that could influence forward-looking
events, please refer to the factors discussed in the Annual
Information Form dated March 25, 2022
under the heading "Risk Factors". These factors are not, and should
not be construed as being exhaustive.
Accordingly, readers should not place undue reliance on
forward-looking statements. The forward-looking information
contained in this news release is expressly qualified by this
cautionary statement. Any forward-looking information and the
assumptions made with respect thereto speaks only as of the date of
this news release. Denison does not undertake any obligation to
publicly update or revise any forward-looking information after the
date of this news release to conform such information to actual
results or to changes in Denison's expectations except as otherwise
required by applicable legislation.
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SOURCE Denison Mines Corp.