Denison plans US$250 million note offering
Denison Mines Corp. [DML-TSX] has announced an offering of US$250 million worth of convertible notes. The company said it intends to use the net proceeds for expenditures to support the evaluation and development of its uranium development projects in Saskatchewan, including the Wheeler River project.
The company said it expects to grant the initial purchasers of the notes an option for 13 days, beginning on, and including the date on which the notes are first issued, to purchase an additional US$37.5 million aggregate principal amount of notes.
The notes will be senior unsecured obligations of the company and will accrue interest at a rate payable semi-annually in arrears on March 15, and September 15 of each year, starting on March 15, 2026. They will be convertible into common shares of the company, cash or a combination of shares and cash, at the company’s election. The notes will mature on September 15, 2031, unless earlier repurchased, redeemed or converted in accordance with their terms.
Prior to June 15, 2031, the notes will be convertible at any time until the close of business on the second scheduled trading day immediately preceding the maturity date.
The interest rate, the initial conversion rate and other terms of the notes will be determined by Denison and the initial purchasers and will depend on market conditions at the time of pricing of the offering. Denison will have the right to redeem the notes in certain circumstances and holders will have the right to require Denison to repurchase their notes upon the occurrence of certain events. (See press release for details.
Denison shares moved lower on the news, easing 3.7% or 11 cents to $2.86. The shares trade in a 52-week range of $3.45 and $1.58.
Denison recently said it has received Ministerial approval under the Environmental Assessment Act to proceed with the development of the In-Situ recovery (ISR) uranium mine planned for its Wheeler River project.
“Our plans are designed to put us in a position to start construction in early 2026, following anticipated regulatory approvals,” Denson President and CEO David Cates said in a press release back in March 2025. “Based on this timeline, we expect to be able to maintain our previous guidance of first production from Pheonix in mid-2028, which would make Pheonix the first new large-scale uranium min in northern Saskatchewan since the Cigar Lake mine was commissioned in 2014,” he said.
A NI 43-101 compliant pre-feasibility completed for Wheeler River in September, 2018, included the selection of the in-situ recovery mining method for the development of the Pheonix deposit, with an estimated average operating cost of US$3.33 per pound of U308. All-in costs are forecast to be US$8.90 a pound.
In-situ recovery involves processing the uranium while it is still in the ground through the injection of catalyzing agents into the ore.