A group of investors is extending support to Sherritt International Corp. following the impact of U.S. sanctions on its operations in Cuba. A consortium comprising 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 disclosed that the proposal has been under consideration by the board since then, and they are making the announcement now to allow the company’s stakeholders to evaluate the available options. If approved, the consortium plans to collaborate with Sherritt to enhance its financial structure and liquidity while safeguarding its Fort Saskatchewan refinery in Alberta and its nickel and cobalt processing capabilities in North America.
Sherritt had previously stated the need for a substantial infusion of capital to support the revival of its Alberta refinery and Cuban joint venture, both of which were suspended due to increased U.S. pressure on Cuba. The company is in discussions with its senior lenders and noteholders to execute a recapitalization strategy aimed at stabilizing its financial position and resuming normal operations when conditions permit.
The company had halted operations at its Fort Saskatchewan refinery after depleting its feed inventory from the Moa mine in Cuba. Meanwhile, the operations at Sherritt’s Moa joint venture in Cuba were halted earlier this year due to fuel shortages caused by the U.S. embargo on Venezuelan oil supplies.
This move comes as Sherritt navigates challenges posed by the sanctions and seeks to secure its operational future amidst evolving geopolitical dynamics.