Citi lifts Paladin price target after nod for Canadian buy
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The news: Citi analysts have lifted their price target on Paladin Energy after the uranium producer received final regulatory approval for its proposed acquisition of Canadian explorer Fission Uranium.
The numbers: The brokerage maintained its ‘buy’ rating on the stock, but increased its price target to $13.50 a share from $11.50 previously.
Paladin shares are down 0.6% to $7.76 in early trading on the ASX.
The context: The upgrade comes after Canada's government gave final clearance for the takeover under the Investment Canada Act (ICA). The takeover will see Fission shareholders receive 0.1076 Paladin shares for each share held and Paladin's shares listed on the Toronto Stock Exchange.
What they said: "Post-acquisition, Paladin should now become the third-largest resource endowment of a listed uranium corporation. The Patterson Lake South project’s production timeline complements Paladin’s existing pipeline," Citi said in a note.
"Additionally, Paladin’s upcoming TSX listing positions the company favourably for increased international capital market exposure."
The source: Citi research
