Declining uranium prices have led to the start of consolidation within the junior uranium space. Uranium explorer Aero Energy (TSXV: AERO) this morning indicated that it would be acquiring its peer Kraken Energy (CSE: UUSA) in an all stock transaction valued at just $1.64 million.
The transaction will see Kraken acquired for $0.02754 per share, which represents a premium of about 20% to the equities 15-day volume weighted average price. Kraken shareholders are set to receive 0.97037 Aero shares for each share of Kraken they currently hold, with Kraken shareholders to collectively own 32% of the resulting company on a post transaction basis.
The basis for the combination is said to be the expansion of uranium assets, with Aero’s Athabasca basin claims to be brought together with Kraken’s US-based assets. With the current push for resource development from the US government, the transaction is said to leverage this permitting push, with plans to conduct drilling at Kraken’s Apex property later this year to unlock value for shareholders.
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The transaction is said to have been unanimously approved by both boards of directors. Kraken shareholders are set to vote on the transaction in June 2025. Subject to the receipt of regulatory and shareholder approvals, the transaction is slated to close by the end of June 2025.
Aero Energy last traded at $0.025 on the TSX Venture.
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