Paladin seeks funding amid uncertain future
IT IS not the best of times for a uranium producer to be tapping the market for fresh funding.
IT IS not the best of times for a uranium producer to be tapping the market for fresh funding.But that is what ASX-listed African uranium producer Paladin Energy is doing, seeking up to $70 million from an institutional placement of shares. The funds are needed to strengthen the group's balance sheet to "ensure the company is well placed to meet all future commitments and pursue identified growth options."It was not inspiring stuff from a company whose share price has been trashed since investor confidence in uranium stocks was undermined by the crisis at Japan's Fukushima nuclear power plant in March.Paladin was a $5 stock before the power plant was knocked out by the earthquake and tsunami that hit Japan. Ahead of going into a trading halt for the bookbuild for the placement, Paladin was trading at $1.31 a share. Expansion at its Langer Heinrich mine in Namibia and development of the Kayelekera mine in Malawi have also caused headaches, contributing to a 74 per cent share price fall since Fukushima.Last month the Perth-based group talked up the prospect of big-spending joint-venture partners picking up the pace on the development of its other uranium projects. It said that it had received eight "genuine inquiries" from potential joint-venture partners and it was a "reasonable aim" to have something finalised by the end of the calendar year.Paladin managing director John Borshoff said at the time that introducing joint-venture partners to fund new developments would achieve growth in a much less costly manner. "This program of monetising some of our non-producing projects with third-party engagement for minority interests was always on our agenda," he said. "We are positioned to make Paladin a partner of choice and this is reflected in the interest and the intensity of discussions we are having."