A group of investors has stepped in to assist Sherritt International Corp. following the impact of U.S. sanctions on 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’s proposal has been under consideration by the board since then, and the announcement is now being made to allow the company’s stakeholders to evaluate potential alternatives. If the proposal is accepted, the consortium aims to collaborate with Sherritt to strengthen its financial position and liquidity, with a focus on maintaining and improving its refinery in Fort Saskatchewan, Alberta, along with its nickel and cobalt processing capabilities in North America.
In response to heightened U.S. pressure on Cuba, Sherritt had previously disclosed the need for a substantial infusion of new capital to support the restart of its Alberta refinery and Cuban joint venture. The company had to halt operations at its Fort Saskatchewan facility due to the depletion of feed inventory from its Moa mine in Cuba.
Sherritt’s activities in the Moa joint venture in Cuba had been put on hold earlier this year as a result of fuel shortages in the country following the U.S. embargo on Venezuelan oil supplies in January. The company is engaged in discussions with its senior lenders and noteholders regarding a recapitalization strategy to stabilize its financial position and resume regular operations when conditions allow.