Yellow Cake on the radar

At the start of July, London's Alternative Investment Market welcomed one of the more unusual companies in its history. Yellow Cake (YCA), the brainchild of former investment banker Peter Bacchus, joined the junior market with one express aim – to raise money to stockpile uranium, in the hope of a price correction. That hope has some foundation. The strength of the pitch was enough to convince investors to part with $201m (£157m) to buy 8.1m pounds of uranium and lock it in a Canadian warehouse. The trick appears to be working – although the global uranium market was aware of the deal ahead of the share offering, a previously flatlining spot price is already up. This self-fulfilling cycle means Yellow Cake shares are up, too; but we think there’s more to come.