Putting Uranium assets into newly listed companies?

[spartn]

Hi guyz

Over ther past few months, I have seen at least 5-6 companies who "do not" have uranium as their main focus, throw all their uranium assets into creating a newly listed company, now im just wondering why??

the two reasons?

1. doing so to build extra capital for the main aims other then uranium.

2. they are are doing this so that if or when the uranium boom finally implodes the fact that the company has Uranium assets will effect the companies share price which they don't want to see crash.

Im just wondering which is the main reason for companies continually spinning off their Uranium assets to form new companies

What are your guyz thoughts on this?


Spartn

:viking:

 

[Broadside]

Re: Putting Uranium assets into newly listed companies???

Hi guyz

Over ther past few months, I have seen at least 5-6 companies who "do not" have uranium as their main focus, throw all their uranium assets into creating a newly listed company, now im just wondering why??

the two reasons?

1. doing so to build extra capital for the main aims other then uranium.

2. they are are doing this so that if or when the uranium boom finally implodes the fact that the company has Uranium assets will effect the companies share price which they don't want to see crash.

Im just wondering which is the main reason for companies continually spinning off their Uranium assets to form new companies

What are your guyz thoughts on this?


Spartn

:viking:

Personally I don't think it is to quarantine the company from an implosion in Uranium....rather it is to cash in on the Uranium boom....a pure play Uranium asset is likely to be valued more highly by the market than if it remains as part of a portfolio of disparate assets: kind of like "reverse synergy" the sum of the parts can be worth more than the whole.

 

[steven1234]

It will also allow capital to be raised for the new company's operations (eg drilling or production) without diluting the original company's capital. Thus the origninal company will take a "free ride" on the sucess of the new company without having to invest much into it (apart from the major asset...).

You need to be able to prove up a reasource and take it to production. This will cost millions which must to come from somewhere. The establishment of a new company is a means by which to raise funds to take a resource into production.

On the risk side, should the resource fail to be ecomonical upon further drilling and study, the losses to the original company will be much less.

It also permits explors to do what they do best, Explore. They can appoint directors with expertise relevant to the new company to develop the resource.

Directors can get free shares and options in the new company. They will also get a second salary on top of the original salary they were getting.