A group of investors is extending a potential lifeline to Sherritt International Corp. following the impact of U.S. sanctions on the Canadian mining company’s operations in Cuba. 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. The announcement is made public now to allow the company’s shareholders, employees, and other stakeholders to evaluate the available alternatives. If the proposed deal is approved, the consortium aims to collaborate with Sherritt to strengthen its financial position and liquidity, while safeguarding and enhancing its Fort Saskatchewan, Alta., refinery and North American nickel and cobalt processing capacity.
In a recent statement, Sherritt disclosed the need for a substantial infusion of new capital to support the restart of its Alberta refinery and Cuban joint venture, which were forced to cease operations due to increased U.S. pressure on Cuba. The company has been engaged in discussions with its senior lenders and noteholders regarding a recapitalization strategy aimed at stabilizing its financial situation and resuming normal activities as conditions allow.
Earlier, Sherritt had announced the closure of its Fort Saskatchewan refinery after depleting its feed inventory sourced from the Moa mine in Cuba. Operations at Sherritt’s Moa joint venture in Cuba were halted earlier this year due to fuel shortages in the country, stemming from the U.S. embargo on Venezuelan oil since January.