A group of investors is extending support to Sherritt International Corp. following U.S. sanctions that have impacted the Canadian mining company. The consortium, which includes an undisclosed U.S. anchor investor, Kyma Capital Ltd., Trifon Natsis, and Glencore Ltd., has presented a non-binding recapitalization proposal to Sherritt’s board of directors in late June.
The consortium has confirmed that the proposal has been under consideration by the board since then, and the announcement is made to allow stakeholders, including shareholders and employees, to evaluate available options. If the proposed agreement is approved, the consortium aims to collaborate with Sherritt to enhance its financial structure and liquidity while safeguarding and improving its Fort Saskatchewan facility in Alberta, as well as its North American nickel and cobalt processing capabilities.
In a recent statement, Sherritt disclosed the necessity for a substantial infusion of new capital to support the recommencement of operations at its Alberta refinery and Cuban joint venture, which were forced to cease operations due to heightened U.S. pressure on Cuba.
The Toronto-headquartered company revealed ongoing discussions with its senior lenders and noteholders regarding a recapitalization strategy intended to reinforce its financial position and resume regular activities when conditions permit. Earlier, Sherritt had announced the shutdown of its Fort Saskatchewan refinery after depleting the feed inventory supplied from its Moa mine in Cuba.
The operations at Sherritt’s Moa joint venture in Cuba were halted earlier this year due to fuel shortages in the country following the U.S. embargo on oil from Venezuela in January.