FRESH from announcing a potentially company-saving deal, Paladin Energy managing director John Borshoff has opened up for the first time about his involvement in the Vietnam War.
As a 23-year-old, he spent two years as an infantryman in the 9th Battalion and was one of only a handful of soldiers from that battalion to serve the entire 388-day tour of Vietnam without being rotated off the platoon.
It was an experience which he says made him who he is today, and which perhaps explains the doggedness he has brought to Paladin at a time of major pressure on the uranium industry.
"I know it's a hell of a way to get experience, but it was a great experience in terms of learning about the human condition, learning about yourself and who you are, and not being ashamed of who you are," Borshoff tells The Weekend Australian.
"One of the things about that environment is that you go in with a certain perception of yourself, and up until that point you can live with that reality or lie all your life and it's never tested. Once you're in that environment, you truly learn about who you are and what
you are capable of or are not capable of."
Records show that the 9th Battalion carried out 11 major operations, each of which lasted about a month. The battalion encountered heavy contact in Vietnam, with 35 of its soldiers killed and more than 150 wounded.
Unsurprisingly, Borshoff says the experience left him a harder person. But he also says it gave him a glimpse of his full potential, setting him up for a career in the volatile global uranium industry.
"I learnt that I didn't embarrass myself with what I had to do for my mates," he says.
"When I came back, it had enhanced my thinking about who I was and what I wanted to do."
Borshoff is reluctant to talk about his time in Vietnam. It's something he doesn't talk much about privately, let alone publicly. He doesn't want sympathy, he doesn't want to be seen as a hero, and he doesn't want to trivialise his experiences and those of his fellow soldiers.
But it's hard not to see the parallels between what Borshoff says he took out of his time in Vietnam and his management approach at Paladin.
He has shown on a number of occasions a willingness to hold his stance in the face of real pressure or contrary market sentiments, from his original decision to pursue the study of Paladin's Langer Heinrich deposit in Namibia during a period of complete investor apathy for all things uranium, to his recent efforts to tackle the company's debt position in the middle of the worst uranium market for years.
This week, Paladin announced it had secured a landmark deal to sell a 25 per cent interest in the Langer Heinrich mine to China National Nuclear Corporation for $US190 million ($218m). That cash injection, coupled with a debt refinancing that will save the company $US35.5m this year, will go a long way towards helping Paladin retire a $US300m convertible bond due to mature at the end of next year.
Despite Borshoff's conviction over the past 18 months that a buyer would be found for the minority stake in Langer Heinrich, there were moments when the market doubted whether it would ever materialise.
Last August, Borshoff decided to terminate all discussions about the sale after the party in the box seat tried to change the terms of the deal at the last moment.
With Paladin still battling low uranium prices and its balance sheet remaining under pressure, it was a bold decision. Not only could it damage his credibility in the eyes of a market that was waiting for a deal, but it would also force Paladin into a heavily discounted equity raising.
The company raised $88m at a 30 per cent discount to its share price, with the raising designed to give Paladin some breathing space as it resumed negotiations.
Even with the CNNC deal in place, Paladin is not out of the woods. The company's second uranium mine, Kayelekera in Malawi, continues to bleed money while the spot price of uranium remains around $US35 a pound.
Borshoff is well aware of the pressures at Kayelekera. He knows the mine cannot go on losing money indefinitely, but he also knows how significant it is to the economy of Malawi.
He says he won't let the relief provided by the deal cloud any decision as to whether the mine should stay open, with the fate of the mine to be decided independently of the progress with the CNNC deal.
Ultimately, the health of Paladin hinges on a uranium price that has remained at stubbornly low levels.
Borshoff has maintained for years that the uranium price is heading upwards, pointing to the need for prices to at least double in order to warrant the construction of uranium mines to meet growing global demand.
The long-running program of recycling old Soviet nuclear warheads into feed for nuclear power plants has come to an end, China is continuing a massive rollout of new nuclear capacity, Japan continues to creep towards a restart of the nuclear plants that were shut in the wake of the Fukushima disaster, but the development of new uranium supply is non-existent.
Borshoff knows from personal experience just how hard it is to develop a new mine, meaning there could be some real pain if and when the supply issues he has been predicting finally materialise.
Despite that picture, uranium prices remain flat -- a phenomenon Borshoff attributes to a lack of understanding of the market by uranium's end users.
"It's like saying an engineer building a rocket understands how iron ore is mined or how lithium is found and how it ends up as that material on his site. These guys (in the nuclear industry) are divorced from mining," he says.
"They don't understand the mining industry. They see it as something that's somehow appended to the nuclear industry. They don't see uranium mining in the context of the global uranium issues confronting the whole world."
Like the uranium price, the Paladin share price remains well below its levels of recent years. Between the eve of Fukushima and October last year, Paladin shares shed more than 90 per cent of their value.
Despite a rally since the CNNC deal, they remain a fraction of their former worth.
Borshoff believes Paladin's rebound is not far away. It is, he says, the only independent miner left that will offer exposure to uranium prices when they finally take off.
"There's no other company in another commodity that's so strategically placed in a sector as Paladin is in the uranium sector," he says. "To me, we're the only loaf of bread in the bakery."
PDN Price at posting:
55.0¢ Sentiment: LT Buy Disclosure: Held
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