Canadian uranium firm Cameco has entered into an agreement to buy Germany nuclear fuel trading company NUKEM. The transaction is due to be completed in the fourth quarter of 2012, subject to regulatory approval.
Cameco will pay Advent, and NUKEM’s other shareholders EUR105 million ($136 million) on closing. The agreement includes provisions for Advent to be given a share of NUKEM’s future earnings, until the end of 2014, under certain conditions.
NUKEM has been involved in the nuclear energy industry for more than 50 years and has developed strong relationships with customers and suppliers involved in the fuel cycle. In 2011, the firm sold 12 million pounds of uranium and it expects to sell between 10 and 15 million pounds of uranium in 2012.
The company's assets include uncommitted inventory and a portfolio of purchase and sales contracts including approximately 4.5 million pounds of uranium that remains available to NUKEM under the HEU commercial agreement through 2013.
"This acquisition complements Cameco's business by strengthening our position in nuclear fuel markets and improving our access to unconventional and secondary sources of supply," said president and CEO Tim Gitzel. "After closing, it is expected that NUKEM will add solid cash flow and will have a positive impact on earnings starting in 2013."
NUKEM will continue to operate as an independent company after closing, Cameco said.
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