Energy Fuels Inc. has announced a binding agreement to acquire Australian Strategic Materials Ltd (ASM) in a deal valuing ASM at approximately A$447 million, offering shareholders a 121% premium. The acquisition aims to establish a vertically integrated Western rare earths supply chain, aligning with critical minerals strategies between the US and Australia.
- Energy Fuels to acquire 100% of ASM via court-approved Scheme of Arrangement
- Offer values ASM at A$1.60 per share, a 121% premium to recent prices
- ASM shareholders to receive Energy Fuels shares or CHESS Depositary Interests plus a special dividend
- ASM board unanimously recommends the scheme, subject to independent expert approval
- Deal to create a near-term Western ‘mine to metal & alloy’ rare earths supply chain
Deal Overview and Valuation
Energy Fuels Inc., a Denver-based critical minerals company, has entered into a binding agreement to acquire Australian Strategic Materials Ltd (ASM) through a court-approved Scheme of Arrangement. The transaction values ASM at an implied equity value of approximately A$447 million on a fully diluted basis, representing a compelling premium of 121% to ASM’s last closing share price of A$0.725 on 20 January 2026.
Under the terms, ASM shareholders will receive 0.053 Energy Fuels shares or CHESS Depositary Interests (CDIs) for each ASM share held, alongside an unfranked special dividend of up to A$0.13 per ASM share payable prior to the scheme’s implementation. This structure offers ASM shareholders both immediate cash return and ongoing exposure to the combined entity’s future growth.
Strategic Rationale and Market Positioning
The acquisition is positioned to create a near-term Western-focused vertically integrated rare earths supply chain, spanning mining, processing, separation, metallisation, and alloying. This integration is significant given the global strategic importance of rare earth elements (REEs), particularly in reducing reliance on Chinese supply chains.
Energy Fuels brings to the table a proven operating track record, notably through its White Mesa Mill in Utah, the only conventional uranium mill in the US capable of processing monazite into separated rare earth oxides. The combined entity aligns closely with the objectives of the U.S.-Australian Critical Minerals Framework, potentially unlocking access to government funding and incentives.
Board Support and Shareholder Considerations
ASM’s board has unanimously recommended that shareholders vote in favour of the scheme, subject to no superior proposal emerging and the independent expert concluding that the transaction is in shareholders’ best interests. Notably, ASM’s largest shareholder and Non-Executive Chair, Ian Gandel, who holds approximately 13.6% of ASM shares, has committed to support the deal.
Additionally, ASM option holders will receive A$0.50 cash per option under a concurrent Option Scheme, further enhancing shareholder value. Energy Fuels has also agreed to seek a secondary listing on the ASX, allowing ASM shareholders to trade Energy Fuels shares locally via CDIs.
Conditions and Timeline
The transaction remains subject to customary conditions precedent, including regulatory approvals (such as from the Australian Foreign Investment Review Board), shareholder and court approvals, and no material adverse changes occurring. The indicative timetable targets completion by June 2026, with key milestones including the dispatch of the Scheme Booklet, court hearings, and shareholder meetings scheduled through the first half of the year.
In light of the scheme, ASM has postponed its extraordinary general meeting to provide shareholders adequate time to consider the transaction.
Implications for the Critical Minerals Sector
This acquisition marks a significant consolidation in the critical minerals sector, combining ASM’s rare earths assets and metallisation capabilities with Energy Fuels’ uranium and rare earth processing expertise. The deal enhances funding capacity and reduces execution risk for ASM projects, while offering shareholders exposure to a diversified portfolio including uranium, rare earths, and vanadium.
Given the strategic importance of rare earths in clean energy technologies and defence applications, this transaction may well accelerate the development of a secure, Western-aligned supply chain, a key priority for both Australian and US governments.
Bottom Line?
As the deal progresses through regulatory and shareholder approvals, investors will be watching closely to see how this union reshapes the Western rare earths landscape.
Questions in the middle?
- Will ASM shareholders approve the scheme at the upcoming meeting?
- How will Energy Fuels integrate ASM’s rare earths operations with its existing assets?
- What government funding or incentives might the combined entity access under the U.S.-Australian Critical Minerals Framework?