Sergey Kirienko, the director general of Russia’s Rosatom, said the state-run nuclear holding company had no plans to buy out Uranium One (UUU-T), adding that its investment in the Canadian company would instead create a “global platform for growth” and would give Rosatom greater access to capital markets.
“It’s more important to have an alliance,” Kirienko explained through a Russian translator at a recent Uranium One hosted luncheon for analysts and investors in Toronto. “We don’t want another subsidiary, we want a partner.”
Rosatom’s subsidiary, ARMZ, is taking a 51% stake in Uranium One and Kirienko noted that the success of the venture would be an important part of Russia’s energy sector reform. (Shareholders approved the deal on Aug. 31.)
“The nuclear industry in Russia doesn’t enjoy the best reputation in the world,” he conceded. “We’re not open enough. . . Our reputation depends somewhat on the success of this venture. It’s important for this to be a success story.”
Kirienko is not short of success stories. The 48-year-old was appointed head of the Russian Federal Agency for Atomic Energy, or Rosatom, in 2005 after a distinguished career that included stints as the Fuel and Energy Minister, prime minister of the Russian Federation, and chairman of the State Commission on Chemical Weapons Destruction.
“He doesn’t fear a challenge,” Uranium One’s president and chief executive, Jean Nortier, joked in his introductory remarks. “He took his five-year-old daughter sky-diving.”
Kirienko spent much of his speech discussing the nuclear renaissance and predicted that the number of nuclear power plants will double by 2030 with demand for uranium exceeding supply.
He also noted that Rosatom hadn’t done a good enough job marketing itself, and pointed out that the nuclear giant has been in the market for over 50 years and accounts for 40% of the world’s nuclear enrichment capacity, 17% of its nuclear fuel fabrication and supply, and 7% of its uranium mining.
Kirienko explained geographical and technological diversification was important to Rosatom because among other things it wants to supply uranium to third-world countries where it has built nuclear power plants.
“We’ve worked with Uranium One for one year when we were a minority shareholder,” Kirienko added. “We understand each other very well. . . It’s important this company stays public and its capitalization continues to grow.”
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