JSC National Atomic Company “Kazatomprom” (“Kazatomprom” or “the Company”) announces its intention to sell its 50% interest (minus one (1) share) in the Uranium Enrichment Center JSC (“UEC”) to its partner in the joint venture, TVEL Fuel Company (“TVEL”), for RUB6.253 billion (approximately US$100 million). The value of the Company’s interest in UEC is based on an independent fair market valuation carried out by a major global advisory firm. Kazatomprom is planning to retain one (1) share in UEC, which will preserve the Company’s rights to access uranium enrichment services under the conditions previously agreed upon with TVEL.
UEC is a joint Kazakhstan-Russian enterprise established in 2006 as part of the implementation of the Comprehensive Program of Kazakhstan-Russia Cooperation in the Peaceful Use of Atomic Energy. It owns 25% (plus 1 share) of the Ural Electrochemical Integrated Plant JSC in Novouralsk, Sverdlovsk region of Russia. UEC was the first company with foreign-ownership to have an interest in a Russian uranium enrichment facility.
Kazatomprom’s decision to effectively exit UEC was based on the Company’s value-driven strategy, as well as its review of current uranium enrichment market conditions. Following negotiations with TVEL and approval by Kazatomprom’s Board of Directors, the transaction was approved by the Federal Antimonopoly Service of the Russian Federation on 30 January 2020, and it is now subject to approval by TVEL’s Board of Directors.
If approved by TVEL’s Board, and subject to customary closing conditions, the sale would be noted as a subsequent event in Kazatomprom’s 2019 Annual Operating and Financial Review and 2019 Annual Financial Statements (expected to be published 5 March 2020), with the financial impact expected to be reflected in the Company’s 2020 first quarter financial statements.