A group of investors is stepping in to support Sherritt International Corp. as the company faces challenges due to U.S. sanctions impacting its operations in Cuba. The consortium, which includes an undisclosed U.S. anchor investor, Kyma Capital Ltd., Trifon Natsis, and Glencore Ltd., has presented a preliminary proposal for recapitalization 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. By announcing this development now, they aim to give Sherritt’s shareholders, employees, and other stakeholders the opportunity to evaluate potential alternatives. If the proposal is accepted, the consortium plans to collaborate with Sherritt to improve its financial structure and liquidity, with a focus on safeguarding and enhancing its operations at the Fort Saskatchewan refinery in Alberta and its nickel and cobalt processing capabilities in North America.
Sherritt previously disclosed its need for a substantial infusion of new capital to support the restart of its Alberta refinery and Cuban joint venture, both of which were impacted by heightened U.S. pressure on Cuba. The company has been in discussions with its key lenders and noteholders to explore a recapitalization strategy aimed at stabilizing its financial position and resuming normal activities when conditions allow.
The decision to halt operations at the Fort Saskatchewan refinery came after the depletion of feed inventory from the Moa mine in Cuba, a joint venture affected by fuel shortages in the country following the U.S. embargo on Venezuelan oil earlier this year. Sherritt’s operations in Cuba have been restricted amid the broader expansion of U.S. sanctions, prompting the company to reevaluate its mining activities in the region.