Energy Fuels prices upsized $600 million convertible notes offering

DENVER - Energy Fuels Inc. (NYSE:UUUU) (TSX:EFR), currently valued at $337.75 million with a P/E ratio of 20.26 according to InvestingPro, has priced an upsized $600 million offering of 0.75% Convertible Senior Notes due 2031 in a private placement to qualified institutional buyers, according to a press release statement issued Wednesday.

The offering, which was increased from the previously announced $550 million, is expected to close on October 3. Energy Fuels also granted initial purchasers an option to buy up to an additional $100 million in notes during a 13-day period. The company maintains a notable 9.02% dividend yield and boasts a GOOD financial health score according to InvestingPro, which offers 6 additional key insights about the company’s performance and outlook.

The notes will be senior unsecured obligations accruing interest at 0.75% annually, payable semiannually beginning May 1, 2026, and will mature on November 1, 2031, unless earlier converted, redeemed or repurchased.

Net proceeds are estimated at approximately $578.1 million, or $674.6 million if the additional purchase option is fully exercised. The company plans to use about $45.9 million to fund capped call transactions, with the remainder allocated to development projects including the Phase 2 rare earth separations circuit expansion at the White Mesa Mill, the Donald heavy mineral sands project in Australia, and general corporate needs.

The notes will be convertible into cash, common shares, or a combination at Energy Fuels’ election, with an initial conversion rate of 49.1672 common shares per $1,000 principal amount, equivalent to a conversion price of approximately $20.34 per share. This represents a 32.5% premium to the company’s closing share price on September 30.

In connection with the offering, Energy Fuels entered into capped call transactions with certain financial institutions to potentially reduce dilution upon conversion. The cap price is initially set at $30.70, representing a 100% premium over the company’s last reported share price.

Energy Fuels describes itself as a leading U.S.-based critical minerals company focused on uranium, rare earth elements, heavy mineral sands, vanadium and medical isotopes. The company generated revenue of $52.89 million in the last twelve months, with a gross profit margin of 100%. Discover more detailed financial metrics and analysis with InvestingPro’s comprehensive company report.

In other recent news, Energy Fuels Inc. announced that its high-purity neodymium-praseodymium oxide has been qualified for use in electric vehicle magnets, having passed all necessary quality assurance benchmarks. The company has also begun pilot-scale production of heavy rare earth element oxides at its White Mesa Mill in Utah, producing dysprosium oxide with a purity of 99.5%. The initial production yielded one kilogram, and the company plans to produce approximately 15 kilograms before shifting to terbium oxide production by the fourth quarter of 2025. Energy Fuels also reported mining 638,700 pounds of uranium in the second quarter of 2025 at its Arizona site, with significant yields in June. Additionally, the company successfully produced its first kilogram of dysprosium oxide at pilot scale, achieving 99.9% purity. In leadership changes, Ross R. Bhappu will become the company’s president effective August 4, 2025, as part of a planned succession, while Mark S. Chalmers will continue as CEO. These developments highlight Energy Fuels’ ongoing efforts in rare earth materials and uranium production.

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