The world’s largest publicly traded uranium company, Cameco Corp., is falling on news that it’s acquiring Westinghouse Electric Company. However, it won’t be tackling the deal on its own; it’s recruiting the help of Brookfield Renewable Partners. 🤝
Under the $4.5 billion deal terms, they’ll split the cost and ownership almost evenly. Ultimately, Cameco will own 49% of Westinghouse Electric, and Brookfield Renewable will own 51%. And although Cameco has the funds on hand to support the acquisition, it is seeking alternatives to fund the deal to maintain its balance sheet health.
President and CEO of Cameco, Tim Gitzel, had this to say about the acquisition: 💬
“We expect the recurring demand for Westinghouse’s operating plant services and nuclear fuel will generate a strong revenue stream and add stable cash flow to complement Cameco’s existing uranium and fuel services business.”
From an investor perspective, the bulls argue that the vertical integration of its business will strengthen its long-term position in the nuclear space. Meanwhile, the bears say the company is giving away its upside at a time when Nuclear and alternative energy sources are finally gaining more traction.
We’ll have to see where this shakes out because acquiring companies typically fall when the news breaks. But so far, it doesn’t look like investors are too thrilled about the deal.
$CCJ shares are down about 15% so far today. 🔻
