Tokyo — The Tokyo Electric Power Company, Incorporated (TEPCO) (TOKYO: 9501), Toshiba Corporation (Toshiba) (TOKYO: 6502), and the Japan Bank for International Cooperation (JBIC), the international wing of the Japan Finance Corporation, today announced that they have signed a new agreement with Uranium One Inc. (U1) (UUU.TO), a major Canadian-listed producer and marketer of uranium, that will end their investment in U1 while securing long-term uranium purchase rights.
With a view to securing stable supply of uranium for civil-use nuclear power plants, the three companies signed a strategic relationship agreement with U1 in February 2009, under which they agreed to subscribe to U1's issue of 117 million new common shares for allocation to third parties. This was amended in December 2009 when the Japanese companies agreed to take up U1's convertible debentures instead of common shares, and that transaction was completed in January 2010.
The new agreement will revise the current relationship as follows.
A June 2010 proposal by JSC Atomredmetzoloto (ARMZ), a Russian uranium mining company, to acquire a majority stake in U1 was accepted by U1's board in July subject to shareholder approval and relevant government approval. The Japanese companies and U1 have reviewed their relationship and confirmed that the Japanese companies could achieve their original objective of securing uranium purchase rights without holding the convertible debentures in U1, and agreed to the new arrangement.
The mechanics of the agreement–the sale of the convertible debentures and confirmation of purchase rights–are expected to be effective by December this year, subject to the completion of ARMZ's acquisition of U1's common shares.
The three Japanese companies will continue to maintain a close relationship with U1.
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