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Patterson Lake headliners Fission Uranium (TSXV:FCU) and joint venture partner Alpha Minerals (TSXV:AMW) received approval from their respective shareholders on previously announced merger plans on Thursday.
Per the September announcement, Fission would acquire Alpha Minerals and its 50-percent interest in the Patterson Lake South property for $185 million. Alpha shareholders would receive 5.725 shares of Fission for each Alpha share. Furthermore, both companies would spin off non-Patterson Lake South assets into new companies, while Patterson Lake South was to remain in the hands of Fission Uranium, the current operator.
As of Thursday’s meeting, both companies announced plans of arrangement that are still subject to approval by the TSX Venture exchange and the Court of Queen’s Bench of Alberta. Court hearings are scheduled for November 29, with the completion of both arrangements expected on December 6, 2013. According to Fission’s press release, the Fission arrangement involves the spinning out of certain assets of Fission to Fission 3.0, and was approved by shareholders during a special meeting held on November 28. The Alpha arrangement involves Fission acquiring all shares of Alpha and spinning out all non-PLS assets to Alpha Exploration.
Speaking with Fission’s CEO, Dev Randhawa, it is clear that the decision to spin out the PLS project is intended to attract the attention of major players, ensuring, of course, that in the end shareholders get the best possible value. “If the asset stayed in two different names, it would have made it difficult for [another party] to negotiate with two different companies,” Randhawa said.
With the merger nearing finalization, Fission is looking forward to moving ahead with its winter program. “We will be putting in at least 92 holes this winter; it will be the biggest drill program in recent history,” Randhawa stated. “We are going to put four to five rigs out there, and the majority of those will be going and drilling in between the zones, and one of them will be out drilling new zones.”
With roughly 200 holes drilled by the summer, Fission aims to release a resource estimate for PLS sometime between the summer and fall of 2014.
As far as Fission Uranium’s spin off, Fission 3.0 will carry on with the company’s legacy of finding properties and developing promising projects with partners.
At Friday’s market open, both companies saw positive price movements, with Fission Uranium up 4.55 percent, trading at $1.15, and Alpha up 3.83 percent, at $6.23.
Securities Disclosure: I, Vivien Diniz, hold no direct investment interest in any company mentioned in this article.
Editorial Disclosure: Alpha Minerals is a client of the Investing News Network. This article is not paid-for content.