A consortium of investors has extended a potential lifeline to Sherritt International Corp. in light of the challenges posed by U.S. sanctions on Cuba. The group, which includes an undisclosed U.S. anchor investor, Kyma Capital Ltd., Trifon Natsis, and Glencore Ltd., recently presented a non-binding recapitalization proposal to Sherritt’s board of directors at the end of June.
The consortium has confirmed that the proposal has been under consideration by the board, and they are making the announcement public to allow the company’s stakeholders, including shareholders and employees, to evaluate the available options. If the proposal is accepted, the consortium plans to collaborate with Sherritt to enhance its capital structure and financial liquidity, with a focus on maintaining and improving its operations at the Fort Saskatchewan, Alta., refinery and its facilities for nickel and cobalt processing in North America.
Sherritt had previously disclosed the need for a substantial infusion of new capital to support the reopening of its Alberta refinery and Cuban joint venture, both of which had been closed due to heightened U.S. pressures on Cuba. The company is in discussions with its senior lenders and noteholders to explore recapitalization strategies aimed at stabilizing its financial position and resuming normal activities when conditions allow.
Earlier, Sherritt had announced the halt of operations at its Fort Saskatchewan refinery after depleting its feed inventory from the Moa mine in Cuba. The operations at the Moa joint venture in Cuba had been halted earlier in the year due to fuel shortages in the country following the U.S. embargo on Venezuelan oil supplies in January.