Cameco (NYSE: CCJ) lands US government nuclear reactor partnership

Cameco Corporation (NYSE: CCJ) stock soared 15% after the uranium producer announced a strategic partnership with the United States government to accelerate the deployment of Westinghouse nuclear reactors.

The binding agreement, established with Brookfield Asset Management, will see the US Department of Commerce arrange financing and facilitate permitting for new Westinghouse reactors in the United States. The projects represent an aggregate investment value of at least $80 billion, including near-term financing for long lead time items.

Under the partnership structure, the US government will receive a 20% participation interest in cash distributions exceeding $17.5 billion made by Westinghouse after the interest is granted. This interest will vest once the government makes a final investment decision to build Westinghouse reactors valued at $80 billion or more.

If the participation interest vests by January 2029 and Westinghouse’s valuation in an initial public offering is expected to reach $30 billion or more, the US government can require an IPO. The government’s interest would then convert into a five-year warrant to purchase equity securities equivalent to 20% of the public value after deducting $17.5 billion.

“We are pleased to see the US government make this commitment to expanding nuclear power capacity using Westinghouse’s proven technology,” said Tim Gitzel, CEO of Cameco. “We expect that our highly successful partnership with Brookfield as owners of Westinghouse will be further strengthened through this strategic collaboration with the US Government.”

The new reactors are expected to generate reliable power for the American grid, including supporting significant data center capacity to drive artificial intelligence growth in the United States.