Shares of Cameco Corp surged over 20% following the announcement of a partnership deal between the uranium company, Brookfield Asset Management Ltd, and the U.S. government to collaborate on constructing nuclear reactors in the United States. The agreement entails the U.S. government facilitating financing and regulatory processes for at least $80 billion US worth of new Westinghouse nuclear reactors.
Brookfield and Cameco completed the acquisition of Westinghouse in November 2023. Cameco’s CEO, Tim Gitzel, expressed optimism about the partnership, stating that the U.S. commitments to new nuclear builds would enhance confidence in nuclear power’s growth potential, benefiting both Westinghouse and Cameco.
The market response was positive, with Cameco shares rising to $146.62 on the Toronto Stock Exchange, a $25.36 increase, while Brookfield Asset Management class A shares also gained $1.50, reaching $77.91. U.S. Commerce Secretary Howard Lutnick emphasized the government’s focus on advancing nuclear technologies rapidly for national security and critical infrastructure enhancement.
As part of the partnership, the U.S. government will receive a participation interest, entitling it to 20% of any cash distributions exceeding $17.5 billion US from Westinghouse. To activate this interest, the U.S. government must finalize investment decisions and agreements for the construction of at least $80 billion US in new Westinghouse nuclear reactors in the U.S. Additionally, the government may convert the participation interest to a warrant to purchase shares in Westinghouse’s IPO equivalent to 20% of the company’s public value, minus $17.5 billion US, under specific conditions.