Uranium Resources Inc (NASDAQ:URRE) shares rose 41.78% on Wednesday to $3.19 and an additional 5.64% to $3.37 in after-hours trading. Share prices have been trading in a 52-week range of $0.97 to $6.00. The company has a market cap of $54.89 million at 13.38 million shares outstanding.
Uranium Resources Inc is a uranium exploration, development and production company which has approximately 190,000 acres of mineral holdings in the prolific Grants Mineral Belt of the State of New Mexico and approximately 14,000 acres in the South Texas uranium province.
The company’s uranium exploration and development activities are focused principally in the United States and the Republic of Turkey and its properties include Temrezli Project, Kingsville Dome Project, Rosita Project, Vasquez Project, Butler Ranch Project, Churchrock Project, Crownpoint Project, Cebolleta Project and Juan Tafoya Project. The Kingsville Dome property is located in Kleberg County. The Juan Tafoya Project is located approximately 45 miles west-northwest of Albuquerque. The Cebolleta project is located in west-central New Mexico. The Sejita Dome exploration project is located in southern Duval County, Texas. The Vasquez project is located in southwestern Duval County, Texas.
Uranium Resources Inc shares have been on a steady climb recently, buoyed by rising prices of the commodity on news that Kazakhstan’s state nuclear-fuel company won’t be producing as much uranium as planned this year. Analysts have remarked how this announcement could mark a strong support level for uranium and that prices could continue to advance in the coming months on lower supply.
This follows the company’s announcement on closing the sale of its Churchrock and Crownpoint properties in New Mexico to Laramide Resources Ltd. This deal is valued at $12.5M comprised of $2.5 million cash, $500,000 of LAM common stock and warrants, a promissory note in the amount of $5.0 million, half of which LAM may satisfy through issuance of its common stock, and a retained NSR royalty on the Properties valued at $4.5 million.
The sale of our Churchrock and Crownpoint properties to Laramide represents URI’s third asset monetization transaction in the last three years. We remain focused on improving the alignment of our uranium portfolio with our production experience and expertise in in-situ recovery of uranium, targeting uranium operations that fit into the lowest quartile of operating costs. We will use the proceeds received from this sale to fund the expansion of our energy metals strategy, which includes developing our new lithium business, while maintaining optionality on the future rising uranium price,” remarked Uranium Resources Inc CEO Christopher Jones.
Recall that uranium prices have been on a steady decline since the massive earthquake in Japan and the resulting Fukushima plant disaster. The transaction with Laramide took over a year to complete as it needs the approval from the U.S. Nuclear Regulatory Commission to transfer materials licenses for the properties to Laramide.
Last month, Resource Capital Fund V L.p. has picked up 835,554 of common stock of Uranium Resources Inc in a published Form 13 filed with the US Securities and Exchange Commission. The acquisition brings the aggregate amount owned by Resource Capital Fund V L.p. to a total of 835,554 representing a 6.2% stake in the company.
DISCLAIMER: There is a substantial risk of loss with any speculative asset, especially small cap stocks. The opinions expressed are those of the author, and do not constitute recommendations to buy or sell a stock. Do your own research before committing capital.
