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The monster resource estimate announced by Fission Uranium Corp. has boosted takeover speculation around the company, and chief executive Dev Randhawa isn’t doing anything to douse that talk.
He said in an interview Monday that investment bankers have already set up a data room for potential bidders. But he is in no rush to do a deal, as the company continues to expand its Patterson Lake South (PLS) uranium discovery in Saskatchewan’s Athabasca Basin.
“We don’t control if someone comes and makes a run at us. We are ready for it if someone does,” Mr. Randhawa said. It has been clear for several months that Fission’s PLS discovery is one of the best uranium finds in decades. But investors and analysts were still highly impressed when they saw the initial resource estimate.
Kelowna, B.C.-based Fission said late Friday the deposit contains an estimated 105.5 million pounds of uranium resources, of which almost 80 million are in the “indicated” category (the rest are in the more speculative “inferred” category). While the discovery is much smaller than Saskatchewan’s two largest uranium mines (McArthur River and Cigar Lake), it compares favourably to everything else in the province. And more than half of the resource comprises a “high-grade zone” that could potentially be mined at very low costs.
“This one is special,” Dundee Capital Markets analyst David Talbot said in a note. He called the resource numbers “truly phenomenal.”
Investors welcomed the news, pushing Fission shares up almost 12% on Monday to $1.13 despite broader weakness in equity markets.
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