Aero Energy (TSXV: AERO / WKN: A4007Y) and Kraken Energy are joining forces to create a leading uranium project developer in North America. As part of this merger, Aero Energy will acquire all outstanding shares of Kraken Energy at a price of 0.02754 Canadian dollars (CAD) each. This represents a 20 percent premium compared to the volume-weighted average price of Kraken Energy’s stock over the last 15 days. Through this purchase, Kraken Energy is valued at approximately 1.64 million CAD.

The agreement, finalized on April 1, 2025, is definitive and still requires approval from shareholders of both companies. The merger creates a new company with a larger presence in the uranium sector, combining Aero Energy’s uranium assets in the Athabasca Basin with Kraken’s uranium assets in the USA, thus creating a robust portfolio across two jurisdictions, which reduces risk and increases potential returns for all shareholders.

The merger agreement stipulates that all issued and outstanding Kraken shares will be exchanged for Aero common shares on the basis of 0.97037 Aero shares for each Kraken share. Currently, there are 59,690,981 Kraken shares and 121,927,277 Aero shares issued and outstanding. Upon completion of the transaction, Aero is expected to have approximately 169,978,517 Aero shares issued and outstanding on an undiluted basis. It is anticipated that after the merger, about 68 percent of Aero shares will be held by current Aero shareholders and about 32 percent of Aero shares by former Kraken shareholders.

An Interesting Mix with Assets in Canada and the USA

For existing Aero Energy shareholders, the merger is particularly interesting because it allows the company to build a strategic presence in America. The merger secures Aero access to the important US uranium market, which currently emphasizes the preference for its own domestic production sites and is pushing these forward with urgency. For Kraken shareholders, the merger offers the opportunity to gain access to an interesting uranium project with plenty of potential in the world-renowned Athabasca Basin in the Canadian province of Saskatchewan.

The merger is taking place at a time when the new US administration is not only drawing attention through ever-new tariffs but is also emphatically working to decisively promote the development of raw material projects within its own country. The focus is on raw materials classified as critical.

These include uranium. It is significant not only because it represents an important raw material for energy generation in nuclear power plants. From a military perspective, it is also essential for the nuclear power USA to build secure access to productive uranium deposits, as the USA’s nuclear weapons potential is outdated, and in its renewal, the US government does not want to be dependent on Russia or countries very close to Russia, such as Kazakhstan.

Donald Trump is Pushing Hard for the Development of Domestic Raw Material Deposits

The order recently signed by Donald Trump to accelerate approval processes is therefore of great importance for the merged company, as it offers the chance to secure the stalled drilling permits for the Apex property and possibly increase the value of US assets for all shareholders as early as 2025.

As a larger company, the new Aero Energy can also expect to see stronger investor interest and higher stock dynamics. Another competitive advantage is the experts with proven successes in uranium discovery and extensive experience in Canadian-American capital markets who will now be working in the merged company.

Both Companies Advise Their Shareholders to Approve the Merger

Both boards therefore welcome the merger and have recommended their shareholders to vote in favor of the transaction. All directors and senior officers of Kraken, who together hold approximately eight percent of the issued and outstanding Kraken shares, have agreed to vote in favor of the transaction.

Accordingly, Galen McNamara, CEO and Director of Aero Energy, expressed his delight about the merger. He stated: “We are proud to merge with Kraken and create a leading uranium explorer that offers significant added value to shareholders of both companies. By combining Aero’s strengths in the Athabasca Basin with Kraken’s US assets, we are able to obtain permits, scale effectively, and certainly leverage the dynamics of the uranium market.”