Uranium Consolidation Continues
InvestorIntel has long been calling for a consolidation in the Athabasca Basin. We took a very public risk with our often-repeated prediction Fission Uranium Corp. would be taken out within 6 months, and that the smaller players would have to unite to survive.
The Fission prediction was accurate, on schedule, and in its wake the consolidation of the juniors has begun.
Last week Alpha Exploration Inc. and Lakeland Resources Inc. (part of the Zimtu Capital Inc. portfolio) announced a proposed merger to blend their assets and teams. More importantly to us, the joint press release described “anticipated synergies resulting in reduced merged general and administrative expenses”. A merged company will eliminate the expense of two transfer agents, two sets of stock exchange fees, two sets of auditors …. and so it goes.
There will have to be more of the same from the Basin. There are still too many companies in the area and there isn’t enough money (either flowthrough or hard) to go around. We applaud the management and shareholders of Alpha and Lakeland for making the hard correct decision to merge, and we encourage others in the area to be as responsible.
Canada’s role in the global uranium market will be driven in part by what these weak juniors do. Shareholders, if you care about your investments in the Basin, contact your management teams and insist they take a step to protect those interests. The status quo is no longer acceptable, as Fission, Alpha and Lakeland are showing us.
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