Shares of Cameco Corp surged over 20% following an announcement of a partnership agreement between the uranium company, Brookfield Asset Management Ltd, and the U.S. government to support the construction of nuclear reactors in the United States. The agreement involves the U.S. government providing financing and expediting permitting and approvals for new Westinghouse nuclear reactors valued at a minimum of $80 billion US.
Brookfield and Cameco completed the acquisition of Westinghouse in November 2023. Cameco’s CEO, Tim Gitzel, expressed optimism about the agreement, stating that the U.S. commitments to new nuclear builds will strengthen confidence in nuclear power’s growth trajectory and drive demand for Westinghouse and Cameco’s offerings.
Cameco’s shares surged to $146.62, up $25.36 on the Toronto Stock Exchange, while Brookfield Asset Management’s class A shares rose by $1.50 to $77.91. U.S. Commerce Secretary Howard Lutnick emphasized the government’s focus on advancing nuclear technologies swiftly for national security and critical infrastructure enhancement.
As part of the partnership agreement, the U.S. government will receive a participation interest that entitles it to 20% of cash distributions exceeding $17.5 billion US from Westinghouse. The interest will vest upon the U.S. government’s final investment decision and completion of contracts for the construction of the specified new reactors. Additionally, the government may convert the participation interest into a warrant to purchase shares in Westinghouse’s IPO equivalent to 20% of the company’s value after subtracting $17.5 billion US.
