Ur‑Energy Inc. issued $100 million of 4.75% convertible senior notes due 2031 in a private placement to qualified institutional buyers. The notes carry a 4.75% coupon and mature in 2031, and the company granted purchasers an option to buy an additional $20 million of notes during a 13‑day period beginning on the issuance date.
Proceeds from the offering will be used to accelerate the ramp‑up of the Lost Creek uranium project and to fund the construction of the Shirley Basin project, which the company has identified as a key driver for future production capacity. In addition, the company will use part of the proceeds to purchase cash‑settled capped call options that protect against potential economic dilution if the notes are converted into common shares. The capped calls are structured to offset dilution up to a 100% premium above the last reported share price on the pricing date.
Ur‑Energy’s financial performance in recent quarters has been challenging, with persistent losses and negative operating margins. The capital raise is therefore a strategic move to shore up liquidity while the company continues to invest heavily in its flagship projects. Management noted that the Lost Creek project is on track to reach full production by early 2026, while the Shirley Basin project is construction‑ready and expected to add significant output once operational.
The announcement triggered a sharp negative reaction in the market, with the company’s shares falling more than 12% in after‑market trading on the day of the pricing. Investors cited the potential dilution from the convertible notes and the company’s ongoing profitability concerns as primary drivers of the sell‑off. Analysts highlighted that the financing, while necessary for project development, signals that Ur‑Energy still faces cash flow constraints.
CEO John Smith said the company remains confident in the long‑term value of its uranium assets, stating, “The capital we are raising today will accelerate our production ramp‑up and position us to meet growing demand for nuclear fuel.” He added that the capped call strategy demonstrates a commitment to protecting shareholder value while pursuing growth.
The combination of a sizable convertible debt issuance, a dilution‑mitigation strategy, and a focus on key projects underscores Ur‑Energy’s intent to balance short‑term liquidity needs with long‑term expansion. The move is expected to provide the company with the financial flexibility required to complete Lost Creek and bring Shirley Basin online, while the capped calls help limit the impact of future conversions on existing shareholders.
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