Sherritt Rejects Kyma Capital's Purported Special Meeting Call

Sherritt International Corporation (TSX:S) has issued a strong response to Kyma Capital Limited's purported call for a special shareholders' meeting on September 29, 2026. The company stated that Kyma's summons is "inappropriate and invalid," emphasizing that Kyma is not entitled to call such a meeting. Sherritt had already set its combined annual and requisitioned special meeting for December 15, 2026. This development further escalates the ongoing tension among shareholders regarding the control and strategic direction of the nickel and cobalt mining giant, Sherritt.

London-based investment manager Kyma Capital holds a significant stake in Sherritt, owning approximately one-third of its outstanding notes and 15% of its common shares. Kyma stated that it called this special general meeting under section 143(4) of the Canada Business Corporations Act, citing the Sherritt board's alleged failure to adequately respond to its July requisitions. Kyma claims that Sherritt's December 15 meeting date is "choreographed" to prevent shareholder intervention before the exclusivity period with Gillon Capital LLC expires on October 12, 2026, by scheduling a vote afterward. Kyma is seeking the removal of Chairman Peter Hancock and another director from the board.

Sherritt, on the other hand, argues that Kyma's actions, including announcing a September meeting date with disregard for ongoing court proceedings, are inappropriate. The company explained that the December 15 date was chosen considering ongoing discussions regarding a potential transaction with Gillon Capital LLC and efforts to present an auditor for appointment at the meeting. It is stated that Kyma's increasingly aggressive public attacks have the potential to jeopardize crucial initiatives underway to navigate the significant challenges Sherritt is currently facing.

Sherritt's shares (S) closed at CA$0.29 on August 13, 2026. The company's second-quarter 2026 earnings report revealed a net loss of CA$9.2 million, compared to a CA$10.4 million profit in the same period of 2025. Revenues also declined from CA$43.7 million to CA$34.0 million. Nickel production decreased from 3,431 tonnes to 1,885 tonnes. This financial performance and managerial uncertainty are increasing investor concerns regarding the company's recapitalization plans and overall stability. The alternative recapitalization proposal submitted by Kyma and a U.S. consortium values new equity at C$0.12 per share.

Sherritt is a world leader in the mining and refining of nickel and cobalt, metals critical for the energy transition, using hydrometallurgical processes. However, the company has faced significant operational and governance disruptions due to the U.S. administration's expanded sanctions against Cuba. This has led to the company seeking to dissolve its nickel mining joint venture in Cuba and the recent shutdown of production at its Fort Saskatchewan cobalt refinery in recent months. These geopolitical risks and operational challenges directly impact the company's financial health, making the need for recapitalization even more urgent.

Analysts indicate that Sherritt's current managerial dispute and the potential transaction with Gillon Capital are critically important for the company's future. The alternative, comprehensive, and fully-funded recapitalization proposal put forth by a U.S. consortium, including Kyma Capital and Glencore, offers a different roadmap for shareholders. This proposal aims to stabilize the company's capital structure and liquidity, enhance the Fort Saskatchewan refinery, and establish a compliant pathway for the business in critical minerals supply chains. In the coming period, the impact of court proceedings and shareholder voting on the company will be closely monitored.