Cameco Corp. completed the sale of its stake in miner Centerra Gold Inc. on Wednesday, bringing the uranium miner closer to its goal of exiting the gold business entirely.
A syndicate of underwriters purchased 88,618,472 common shares of Centerra for a cost of $10.25 per share, so the deal will net $875 million for Cameco. The miner plans to use the proceeds to increase output at its core uranium assets.
The company also arranged to transfer an additional 25,300,000 common shares of Centerra to Kyrgyzaltyn JSC. When both transactions are complete, Cameco will have divested its entire gold asset portfolio.
Centerra was formed in an initial public offering in 2004. But Cameco has held a controlling interest ever since.
One of the world's largest uranium miners, Cameco has been beset by problems in recent years, even as prices for the underlying commodity it provides have soared. Gold prices have also been on a tear this year, topping out at more than $1,200 US an ounce earlier this month.
Cameco's Cigar Lake mine in Northern Saskatchewan's Athabasca basin is believed to be the world's largest undeveloped uranium deposit in the world.
The site was expected to be producing uranium by 2007 after construction began in 2005. But floods in 2006 and then again in 2008 have delayed that timeline, and the site is not expected to be operational until 2011 at the earliest.
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