RE: Re RNS22 Nov 2021 08:56
This was highlighted in RNS of 26 Oct so for me at least it was already priced in and held as a liability in NAV calcs. Incidentalyl NAV at U $47 is £3.67 and SP this morning at £3.40.
https://www.lse.co.uk/rns/YCA/proposed-uranium-purchase-and-placing-173qu1h44aw202v.html
"([3]) Yellow Cake purchase of 8,091,385 lb U3O8 from Kazatomprom at IPO on 5 July 2018 for a cash consideration of USD 170,000,000 under the Framework Agreement (the "Initial Purchase"). As part of the Initial Purchase, the Company benefited from a purchase price which was 2.5% below the spot price, resulting in the Company receiving an aggregate discount of approximately USD 4.3 million. In exchange for this discount, the Company provided to Kazatomprom an option to repurchase up to 25% of the Initial Purchase volume of 8,091,385 lb U3O8 at the prevailing uranium spot price less an aggregate discount of approximately USD 6.5 million (the "Repurchase Option"). The Repurchase Option could only be exercised if the U3O8 spot price exceeded USD 37.50 /lb for a period of 14 consecutive days (the "Pricing Condition"), starting three years from 5 July 2018 and expiring on 30 June 2027 and was exerciseable within 60 days of the Pricing Condition being met. The Company had a corresponding option (the "Buyback Option") to purchase from Kazatomprom all or a portion of the volume repurchased by Kazatomprom under the Repurchase Option at the prevailing spot price. The Pricing Condition was met on 17 September 2021 and the parties are in discussion regarding arrangements for the exercise of the Repurchase Option and the Buyback Option. It is expected that, subject to final agreement, Yellow Cake and Kazatomprom will agree that Kazatomprom will exercise its Repurchase Option at a price of USD43.25/lb less an aggregate discount of USD 6.5 million, after which Yellow Cake will exercise its Buyback Option for the same quantity at a price of USD43.25/lb, resulting in a net payout to Kazatomprom of USD 6.5 million."
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