Soul Patts, Rich Listers tip into NexGen $240m financing
afr.comCanadian uranium developer NexGen Energy has secured $US155 million ($240 million) in financing from investment house Washington H. Soul Pattinson and recourse sector investor Queens Road Capital.
The pair sit alongside Hong Kong billionaire Li Ka-shing as major shareholders in the $3.5 billion market cap company. Queens Road Capital is backed by mining magnate Andrew Forrest and fast-food billionaire Jack Cowin.
Jack Cowin built his fortune on the back of Whopper burgers. Louie Douvis
The $US110 million ($170 million) worth of convertible debentures have a 9 per cent coupon and a five-year term – part cash, part stock. Soul Patts has also bought a $US45 million ($70 million) block from Queens Road, taking the total transaction size to around $240 million.
NexGen Energy is developing the Rook 1 project in Canada’s Athabasca Basin, considered to be the largest undeveloped uranium deposit in the country. Once completed, it will be the single largest uranium-producing mine in the world at full production north of 27 million pounds of annual production.
As per the NI43-101 Rook I Feasibility Study, the payback on capex is less than 12 months and the company is projected to earn around $CA2 billion ($2.3 billion) earnings before interest, taxes, depreciation and amortisation at spot prices. Uranium spot prices have crept up to 12-year highs of $US58 per pound.
NexGen Energy is dual-listed on the Toronto Stock Exchange and the Australian Securities Exchange.
Aitken Mount Capital Partners was the sole advisor to the transaction.
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