ASX-listed Global Uranium and Enrichment has entered into a binding scheme implementation deed (SID) with US natural resource exploration company Snow Lake Resources, pursuant to which they have agreed to a merger to be conducted by way of schemes of arrangement.

Under the terms of the SID, Snow Lake will acquire 100% of the fully paid ordinary shares of Global Uranium that it does not already own and 100% of the unlisted Global Uranium options for new Snow Lake warrants, subject to the satisfaction of various conditions.

The consideration implies an equity value for Global Uranium of A$44.5-million.

The combination is aimed at establishing a leading US-focused uranium developer, underpinned by a multiproject portfolio.

The companies highlight a “unique opportunity” to consolidate the existing 50:50 Pine Ridge joint venture (JV) with Global Uranium to simplify ownership, remove cost duplication and accelerate exploration.

Pine Ridge is currently subject to a 50:50 JV between Snow Lake and Global Uranium, which is located in the Powder River Basin, in Wyoming.

The combination provides Global Uranium shareholders with exposure to a diversified portfolio of uranium and critical minerals, evolving into a full spectrum energy fuels company, the companies say.

Moreover, a stronger capital markets profile with an enhanced market capitalisation and combined $18.5-million in cash provides flexibility to aggressively advance exploration programmes across the combined portfolio.

The combined group will have a Joint Ore Reserves Committee-compliant mineral resource estimate of about 58-million pounds of uranium oxide. 

The companies posit that strategic investments provide enhanced upside to accelerating the clean energy thematic and additional exposure to the nuclear fuel value chain, particularly through Global Uranium’s ownership in Ubaryon, a private Australian company developing next-generation uranium enrichment technology.

“The acquisition of Global Uranium is another step in Snow Lake’s strategy to create a US-focused nuclear fuel cycle company.

“Combining our assets with those of Global Uranium is a natural fit for our strategy, as it consolidates our joint venture with Global Uranium on the Pine Ridge uranium project in the prolific Powder River Basin in Wyoming, allowing for an expedited pathway to development and eventual production,” highlights Snow Lake CEO Frank Wheatley.

“This transaction will also enhance our footprint across the nuclear fuel cycle through our exposure to uranium enrichment technology being developed by Ubaryon, as well as our partnership with Exodys Energy to develop small modular reactors.

“Both sets of shareholders are expected to benefit from the increased scale of Snow Lake, by establishing a significant presence in the Powder River Basin in Wyoming, with additional uranium assets in Colorado, Utah, Canada and Namibia, together with increased exposure to the US nuclear fuel cycle, all against the backdrop of highly attractive long term uranium fundamentals and US administration policies on nuclear energy,” he adds.

“The schemes announced today provide an opportunity for Snow Lake and Global Uranium shareholders to create a significant uranium exploration business. It also provides Global Uranium shareholders and holders of Global Uranium options with an exciting opportunity to become part of an emerging uranium explorer, particularly with the logical consolidation of Pine Ridge,” says Global Uranium MD Andrew Ferrier.