A cluster of investors is extending a lifeline to Sherritt International Corp. following the impact of U.S. sanctions on the Canadian mining firm. The consortium, which includes an undisclosed U.S. anchor investor, Kyma Capital Ltd., Trifon Natsis, and Glencore Ltd., has presented a non-binding recapitalization proposition to Sherritt’s board of directors in late June.
The proposal has been under the board’s consideration since then, with the consortium choosing to announce the development now to allow the company’s stakeholders to evaluate potential alternatives independently. If approved, the consortium aims to collaborate with Sherritt to stabilize its financial structure and liquidity, with a focus on preserving and enhancing its Fort Saskatchewan, Alta., refinery, along with its nickel and cobalt processing capacity in North America.
Sherritt had previously disclosed the need for a substantial infusion of new capital to support the restart of operations at its Alberta refinery and Cuban joint venture, which had been closed due to increased U.S. pressure on Cuba. The Toronto-headquartered company had been in discussions with its senior lenders and noteholders regarding a recapitalization strategy to strengthen its financial position and resume normal operations at a suitable juncture.
In an earlier announcement, Sherritt revealed the suspension of activities at its Fort Saskatchewan refinery after depleting its feed inventory sourced from the Moa mine in Cuba. The operations at Sherritt’s Moa joint venture in Cuba were halted earlier in the year due to fuel shortages in the country following the U.S.’s halt of oil access from Venezuela in January.