(Corrects currency to Canadian dollars, not U.S. dollars. The
error also appeared in previous versions of the story.)
May 1 Sherritt International Corp, Korea
Resources Corp (Kores) and Sumitomo Corp,
partners in the Ambatovy nickel operation in Madagascar, have
agreed in principle to revise their joint venture agreement,
Sherritt said on Monday.
As a result, Sherritt's stake in the joint venture will be
reduced to 12 percent from 40 percent in exchange for the
elimination of C$1.4 billion ($1.02 billion) of loans it needed
to repay, Sherritt said in a statement.
Toronto-based Sherritt will remain as the operator of
Ambatovy, which consists of a nickel-cobalt mine and processing
and refining facilities, until at least 2024.
The revised terms "removes the largest area of uncertainty
for both Ambatovy and Sherritt," Sherritt Chief Executive David
Pathe said. "With this transaction, we eliminate $1.4 billion in
debt from Sherritt's balance sheet," he said.
Sherritt did not reveal the new shareholdings of its
partners in Ambatovy. Previously, Sumitomo owned a 32.5 percent
stake and Kores 27.5 percent.
Nearly half the world's nickel operations are producing
metal at a loss, Pathe told Reuters July 26, following a
collapse in the nickel price partly due to overcapacity.
($1 = 1.3659 Canadian dollars)
(Reporting by Nicole Mordant in Vancouver; Editing by Leslie
Adler and James Dalgleish)