Top Stories This Week: Uranium Price Powers Higher, Sector M&A Heats Up

Uranium was in focus this week as the spot price for the fuel continued to track increasingly higher.

There's a lot going on in the sector, and I recently had the chance to ask Justin Huhn of Uranium Insider about what's going on. We covered a lot of ground in the interview, but a key point that he emphasized was how fragile uranium supply is right now.

Huhn explained that entities like the Sprott Physical Uranium Trust (TSX:U.U,OTCQX:SRUUF) have cleaned up aboveground mobile inventories, placing the industry at an inflection point. He sees a "supply black hole" emerging in the mid-term, which could have major consequences for prices and equities moving forward.

"I think we're healthily in the next leg up in this market, and the uranium price should continue to move meaningfully higher, potentially into a spike scenario. You want to have a seat at the table when that happens — don't get too cute with trading in and out of positions, just hang on," he explained. You can watch the full interview here.

On top of that, the uranium market got a taste of M&A activity on Wednesday (September 27), when IsoEnergy (TSXV:ISO,OTCQX:ISENF) and Consolidated Uranium (TSXV:CUR,OTCQX:CURUF) announced a share-for-share merger.

Under the definitive arrangement, IsoEnergy will acquire all the issued and outstanding common shares of Consolidated Uranium that are not currently held by itself or its affiliates. Consolidated Uranium shareholders will receive 0.5 of a common share of IsoEnergy for each Consolidated Uranium share that they hold.

IsoEnergy's focus is the Hurricane deposit at its Larocque East uranium project in Canada's Athabasca Basin. For its part, Consolidated Uranium has a portfolio of properties spanning the US, Canada, Australia and Argentina. Its main focus is on moving forward at its past-producing conventional uranium and vanadium mines in Utah and Colorado.

In a press release, the companies explain that their goal is to create a multi-asset, multi-jurisdiction uranium producer that will operate at a global level. They believe they have common ground, and will be able to generate value for shareholders.

Many uranium market watchers see the news from IsoEnergy and Consolidated Uranium as a sign of what's to come, and we'll be keeping you posted on future mergers and acquisitions in the sector.

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Securities Disclosure: I, Charlotte McLeod, hold no direct investment interest in any company mentioned in this article.

Editorial Disclosure: The Investing News Network does not guarantee the accuracy or thoroughness of the information reported in the interviews it conducts. The opinions expressed in these interviews do not reflect the opinions of the Investing News Network and do not constitute investment advice. All readers are encouraged to perform their own due diligence.