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How Hostility in the Athabasca Basin affects Unity! In June I wrote up a uranium company Unity Energy (TSXV: UTY) whichhas some of the best and most strategic undeveloped land packages in theAthabasca basin. Even though Unity hosts such fantastic properties,they have one of the smallest market caps of any junior operating in thebasin….. Why? Simple…. The market doesn’t know about them yet! Theseare exactly the kind of stories we love to find and have the best shotof making substantial gains on!
Even with Fukushima on the back of investors’ minds, it is hard toignore that the uranium space is heating up! Just look at all the recentactivity:
The recent bidding war for Hathor Exploration by Rio Tinto and Cameco which finally ended in a $700M takeover by Rio Tinto.
Fission Explorations recent $10M bought deal, which now gives them a ~$25M cash position.
The spot price of uranium continues to rise at an aggressive rate.
In light of all this activity, I think Unity will have a lot ofattention coming its way. With $700M cash now available from the Hathortakeover it is hard to believe none of this money will trickle intouranium juniors like Unity which have some of the most strategic landpackages left in the basin.
Key facts that make Unity a winnerLarge land position (8 properties staked in key uranium mining districts in Saskatchewan 27,500 hectares)
Tight Share Structure (23,000,000 shares outstanding) 50% insider owned.
Patrone Gold Spin out (should occur shortly)
Strong partner (FNR:TSX) 49 North is the leader in exploration in Saskatchewan. 10.8% ownership.
I think that at these prices Unity is something we should befollowing. I believe there will be a lot of consolidation and M&Aactivity in the basin because uranium companies are still trading wellbelow normal valuations. This will only help Unity in the end.
Unity Indentifies High Value Target at Lampin LakeThe Lampin lake property is 16km south east of the roughrider depositand on all sides it is surrounded by Cameco claims. Just the other dayUnity announced that they have identified a high value zone called theShamus zone, in addition to Waterbury lake Unity now has another greatproject they can fall back on.
Spinning out the goldWith all this in mind, do not overlook the grassroots Dickens LakeGold project. The spinout should be happening within 2 months, and thatmeans investors will get 1 free share for every two shares of Unity thatthey own. With this tight of structure I could see the potential forUnity to be well over $1.00 per share in the next year and still theywould have less than a $30M market cap!
The stock is up significantly in the last few weeks, with the tightshare structure expect the trend to continue. Unity finished the day up31.82% yesterday! I think this only the start!