NU. Nufcor

RNS Number:4565S
Nufcor Uranium Limited
07 March 2007

7 March 2007

           NUFCOR URANIUM LIMITED ("NUFCOR URANIUM" OR "THE COMPANY")

                   PROPOSED CHANGES TO INVESTMENT GUIDELINES

Since Admission, Nufcor Uranium has successfully met its investment objective of
investing at least 90% of the net proceeds of the subscription for Shares in
U3O8. The Company has also undertaken a U3O8 loan transaction. This generated
revenue which has been used to meet some of the Company's operating expenses.

The price of U3O8 has also risen significantly, leading to a rise in Nufcor
Uranium's NAV per share from #1.90 as at 31 July 2006 to #3.10 on 28 February
2007, a gain of approximately 63%.

The Directors have now proposed two changes to Nufcor Uranium's Investment
Guidelines which would, they believe, further enhance the Company's prospects.
As these amendments are material, the approval of Shareholders at an
Extraordinary General Meeting is required, which will be held on 26 March 2007.

The proposed changes will

   * allow the Company to invest in uranium hexafluoride ("UF6"), as well as
     in U3O8, and
   * remove the current restriction on the proportion of the Company's
     Uranium which may be lent to third parties.

An explanation of the background to these proposed changes is given below.

UF6

Prior to Admission, consideration was given to whether the Investment Guidelines
should also allow the Company to invest in UF6. At that time the Directors
believed that the U3O8 market would give sufficient scope to maximise
shareholder value. UF6 currently derives approximately 94% of its value from the
price of U3O8 and the Directors believe it represents another means for
investors to gain exposure to the price of U3O8. Given the Company's and the
Uranium market's development since Admission, the Directors believe that it
would now be a natural step in the Company's evolution for it to also be able to
invest in UF6. It is therefore proposed to amend the Investment Guidelines to
allow the Company to invest in, and/or acquire, UF6 as well as U3O8.

U3O8 is converted into UF6 gas by chemical processes making it suitable for use
in uranium enrichment. UF6 is a separate commodity from U3O8. Like U3O8, UF6 is
fungible in its natural state. This allows purchase, sale and lending
transactions to be effected by book transfer rather than by physical delivery.
Ownership of UF6 is restricted to those entities which hold UF6 accounts at an
enrichment facility.

The value of UF6 reflects the price of conversion services and the price of
U3O8. The price of conversion services currently represents approximately 6% of
the price of UF6. The balance, of approximately 94% (at current values), relates
to the price of U3O8.

Lending limit

To date, the Company has undertaken one lending transaction and currently
expects to sign another transaction within the next few weeks. The Directors
believe that there are other potential opportunities to lend Uranium.

It is proposed to amend the Investment Guidelines to remove the current
restriction on the proportion of the Company's Uranium which it may lend to
third parties.

Any proposed lending activities would continue to be at the Board's discretion
and would be subject to consideration of credit worthiness and credit
concentration issues, the provision of appropriate security, and other risk
mitigation measures. The Directors have previously approved a set of guidelines
for use in evaluating proposed loans.

Further information on the proposed changes is set out in the Circular to
shareholders.

Commenting on the proposed changes, Michael Travis, Chairman of Nufcor Uranium,
said:

"Over the seven months since flotation, Nufcor Uranium has successfully met the
investment objectives set out in its Admission Document. Given that the current
world supply of U3O8 is very tight, we believe that the proposed changes to the
Investment Guidelines would give the Company greater flexibility to exploit the
investment opportunities which are available to it and that the proposed changes
will generate value for Shareholders."


For further information, please contact:

Nufcor Uranium Limited                          +44 772 054 7834
Michael Travis (Chairman)

Deutsche Bank AG                                +44 20 7545 8000
John Lydon
Phil Cowdy

Smithfield                                      +44 20 7360 4900
Rupert Trefgarne




                      This information is provided by RNS
            The company news service from the London Stock Exchange

END
MSCDGGGFNVLGNZM

Nufcor Uranium (LSE:NU.)
Historical Stock Chart
From May 2024 to Jun 2024

Nufcor Uranium (LSE:NU.)
Historical Stock Chart
From Jun 2023 to Jun 2024