Jervois Global Initiates Prepackaged Bankruptcy, Secures $145 Million from Millstreet Capital

Jervois

Australian cobalt and nickel miner Jervois Global has commenced a prepackaged Chapter 11 bankruptcy procedure in the US, paving the way for a significant recapitalization with funds secured from US investment advisor Millstreet Capital Management.  This strategic financial restructuring aims to revitalize the company amidst challenging market conditions.

Recapitalization and Restart of São Miguel Paulista Refinery

Millstreet, a current lender to Jervois, has committed to injecting $145 million of new equity capital into the company. This infusion of funds will not only facilitate the recapitalization but also enable Jervois to transition to a private company. A key component of this investment will be the restart of the São Miguel Paulista nickel-cobalt refinery in Brazil. Jervois anticipates maintaining normal operations throughout the recapitalization process, ensuring minimal disruption to its business activities.

Challenges and Future Plans

Jervois commenced operations at the Idaho Cobalt Project in October 2022, marking a milestone as the sole cobalt mine in the US. However, production was unfortunately halted just six months later due to a significant decline in cobalt prices.  As of December 31, 2024, cobalt prices for 99.8% grade material were assessed at $15.50-16/lb fob US warehouse, remaining stable from the previous weeks but drastically lower – a 60% decrease – compared to the peak reached in April 2022. Despite these challenges, Jervois initiated an engineering and feasibility study in October 2023 for a proposed 6,000 metric tonne/year cobalt refinery to be located in the US, demonstrating the company's long-term commitment to the cobalt market.