Globally diversified uranium company IsoEnergy has announced the sale of its Argentina-based uranium projects to Jaguar Uranium, as its enhances its focus on core jurisdictions including the US, Canada and Australia.
The deal includes the transfer of 100% of the shares of IsoEnergy's subsidiary, which holds interests in the Laguna Salada Project in Chubut and the Huemul Project in Mendoza in Argentina.
Jaguar Uranium, a privately held company with a focus on the uranium sector in Latin America, plans to list on a North American stock exchange soon.
The acquisition's terms involve Jaguar offering $10m of its Class A common shares at $5 per share, amounting to two million Jaguar Shares.
Additionally, Jaguar has committed to a 2% net smelter returns (NSR) royalty on all production from the Laguna Salada Project.
It also has the option to repurchase 1% of this royalty for $2.5m within seven years.
A 1% NSR royalty on production from part of the Huemul Project is also stipulated under the agreement, with an option for an additional 1% NSR on the project's remainder.
Should Jaguar fail to list within 12 months post-closing, IsoEnergy will receive 400,000 additional Jaguar shares, valued at $5 apiece.
If the listing occurs within 12 months but the share price is below $5, additional shares will be issued to maintain a $10m valuation of the properties, with a minimum share price of $4.
Additionally, if the listing happens after 12 months, the valuation will increase to $12m, with a condition that Jaguar completes a concurrent financing of at least $5m.
The Jaguar shares involved in the transaction will be under a six-month resale restriction following the listing date.
Furthermore, an investor rights agreement grants IsoEnergy the right to participate in future Jaguar equity financings to maintain its proportional interest and the right to nominate one board member.
IsoEnergy director and CEO Philip Williams said: “Since the merger with Consolidated Uranium late last year, IsoEnergy has been largely focused on advancing the Laroque East project in the Athabasca Basin, host to the high-grade Hurricane Deposit, and restarting its past-producing uranium mines in Utah, the Tony M, Daneros and Rim Mines.
“At the same time, we have been pursuing opportunistic transactions to realise value from "non-core" assets in the portfolio.
"Today's announcement is one such transaction. We firmly believe that every uranium pound in every jurisdiction will be required to meet expected future uranium demand and Jaguar, with its Berlin project in Colombia and now the IsoEnergy Argentinian Properties, has an important roll to play in South America.”
