Australia-based uranium developer Deep Yellow has secured binding commitments to raise A$220m through a placement to develop its Tumas Project in Namibia.

The placement will see the issuance of 179,591,836 fully paid ordinary shares at A$1.225 apiece.

It will be done in two tranches, with the second tranche awaiting shareholder approval.

Under Tranche 1, the company looks to attract around A$140.5m through the issuance of 114,706,334 shares, while Tranche 2 will help garner around A$79.5m through the issuance of 64,885,502 shares.

Additionally, the company plans to raise A$30m through an SPP to be offered to eligible Deep Yellow shareholders.

Deep Yellow noted that the placement was backed by both new and existing domestic and international institutional investors.

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A substantial portion of the funds are earmarked for the advancement of the Tumas Project, which includes start of construction after final investment decision (FID) and obtaining debt funding.

The company also plans to utilise the funds to further its organic growth initiatives. These include the updated definitive feasibility study for the Mulga Rock Project and the exploration of the Alligator River Project in the Northern Territory, as well as the Omohola Project in Namibia.

Moreover, Deep Yellow is set to continue its inorganic growth strategy, focusing on mergers and acquisitions that add value.

Deep Yellow managing director and CEO John Borshoff said: “We are very pleased with the success of the placement raising $220m, buoyed by the overwhelming level of interest to participate, and would like to thank all existing and new investors for their support.”

“The significant interest in the placement and quantum of equity raised represents an important milestone in the development of Deep Yellow, allowing us to materially advance the Tumas Project and bring an important greenfield conventional uranium project into production within the next three years.

“This is the result of a consistently applied, focused seven-year strategy based on the foresight that the uranium supply squeeze currently being experienced was inevitable.”

In March 2022, Deep Yellow entered an all-stock deal valued at A$658m to merge with rival Vimy Resources.

The deal was closed in August of the same year, creating a new global uranium player with uranium mineral resource inventories of more than 389 million pounds.