Sherritt to Sell Majority Stake to Gillon as It Looks to Tackle U.S. Sanction Risk

By Robb M. Stewart

Sherritt International plans to sell control to Gillon Capital as it looks for a deal to avoid being caught up in the Trump administration's efforts to squeeze Cuba's regime.

The Canadian nickel and cobalt miner, which has ventures that tie it to Cuba, said it has reached a non-binding agreement to sell warrants for shares to Gillon.

The warrants would be exercisable for an up-to-55% stake in Sherritt at a price to be agreed by the pair for a period ending nine months from the closing date of the transaction. Sherritt said it expects that price would be at a discount to the closing price for its share on May 15, the day it had unveiled a since-cancelled plan to dissolve its Cuba ventures and cut ties with the island.

Sherritt said it has engaged with the U.S. Department of State, which confirmed the department and Treasury don't object to Gillon's negotiations with Sherritt. Based on information provided to date, the State Department doesn't consider the negotiations to be contrary to U.S. law, though any deal between the companies would be subject to department and Treasury approval, it said.

The Canadian company has been looking for a quick exit from its activities in Cuba after Washington at the start of the month issued an executive order expanding sanctions against the island nation. Sherritt hasn't been formally designated under the executive order, but has told investors that could occur at any time and might mean financial or other providers would be unable or unwilling to continue to support the company's operation or other business activities.

Last week, Sherritt said it would tell its venture partners in Cuba it would use provisions in their agreements to dissolve the partnerships, but earlier this week halted those efforts. Its participation in activities in Cuba remains suspended.

Sherritt's interests in Cuba include Moa, an equal venture with General Nickel Co. of Cuba that has nickel and cobalt mining operations in Cuba, and a refinery in Fort Saskatchewan in the Western Canadian province of Alberta. It also owns a one-third interest in Energas, a Cuban venture established to process raw natural gas and generate electricity for sale to the Cuban national electrical grid, as well as oil and gas interests in two production-sharing contracts that are each in the exploration phase.

The planned private-placement deal with Gillon remains subject to the signing of definitive documentation and will need regulatory approvals, including from the Toronto Stock Exchange.

Sherritt's shares have dropped 52% so far this month, last closing in Toronto Tuesday at C$0.12.

Write to Robb M. Stewart at robb.stewart@wsj.com

(END) Dow Jones Newswires

May 20, 2026 09:39 ET (13:39 GMT)