May 02, 2017
Agreement in Principle Reached on Sponsor Structural Change in Ambatovy Nickel Project, Madagascar
Sumitomo Corporation (Head Office: Chuo-ku, Tokyo; President and CEO: Kuniharu Nakamura) has announced that the three sponsors, Sherritt International Corporation (Head Office: Ontario, Canada; President and CEO: Mr. David Pathe; hereinafter, “Sherritt”), Korea Resources Corporation (Head Office: Gangwon-do, Korea; President and CEO: Mr. Young-Min Kim) and Sumitomo Corporation, have reached an agreement in principle on revising the partnership structure of Ambatovy Nickel Project (“Ambatovy”). This agreement is subject to certain internal and third party approvals and the completion of binding and definitive documentation.
After the structural change, Sherritt will reduce its interest to 12% from the current 40% and resume funding at the same level retroactively to the end of 2015 and on a go-forward basis, continuing its commitment to remain as Operator.
Sumitomo Corporation will gain 15.2% of Sherritt’s share to become a 47.7% shareholder. This interest is in exchange of a non-recourse loan from Sumitomo Corporation to Sherritt, and thus requires no additional expenditure for the transaction and exposure of Sumitomo Corporation to Ambatovy will not change after the close of the deal.
With the increased stability of partnership achieved by this new structure, Sumitomo Corporation will, hand in hand with its partners, firmly support Ambatovy in its endeavor to become a world leading nickel laterite project.
Corporate Communications Department,