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Canada uranium fund plans big purchase, stock sale Verfasst am: 11.03.2008 - 23:08 -------------------------------------------------------------------------------- TORONTO, Feb 28 (Reuters) - Canada's Uranium Participation Corp (U.TO: Quote) sees the uranium price cycle "at or near the bottom," and moved on Thursday to take advantage with a C$65 million ($69 million) stock sale to fund the purchase of 900,000 pounds of the commodity. The fund, which currently holds about 4.5 million pounds of U3O8 uranium, said it would issue 6,375,000 common shares at C$10.20 each on the Toronto Stock Exchange. The purchase would boost its U3O8 holdings by about 20 percent, and represents about 5 percent of the whole 2007 spot market activity in uranium -- the key fuel for the nuclear power industry, which provides about 16 percent of the world's electricity. "We looked at the availability of the material and the price of the material ... and it would be our view that we are at or near the bottom of the price cycle," said James Anderson, who serves as chief financial officer of both Uranium Participation and its managing firm, Denison Mines Corp (DML.TO: Quote). The Toronto-based fund aims to buy the commodity by the end of March, Anderson said in an interview. Banks and hedge funds have recently followed the lead of the fund, which for nearly six years has bought the commodity to hold in anticipation of a surge in spot prices. Spot uranium was around $73 per pound this week, down from a high of $136 last June. "There is a shortfall in uranium, and there is projected to be a shortfall between supply and demand until 2010 at the earliest," said Raymond Goldie, senior mining analyst at Salman Partners. "This purchase -- no matter what form it takes -- will tighten that market." He added that uranium, which typically reacts slowly to news on supply and demand, has been relatively cheap the last couple weeks so now may be a good time to buy. Because Uranium Participation does not have a license to purchase and hold uranium directly, the fund buys and holds the commodity through Denison Mines. "My view is that uranium spot prices will rise to $80 per pound in the near term," he said. By Jonathan Spicer © Reuters 2008. All Rights Reserved. |
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| aus der Diskussion: | MEGA URANIUM LTD. (MGA.TO): JAMES DINES TOP PICK |
| Autor (Datum des Eintrages): | hasi22 (12.03.08 08:54:28) |
| Beitrag: | 101 von 217 (ID:33615932) |
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