Sumitomo Finances Ambatovy Stake Sale to Exit Project
Sumitomo Corp is providing financing to the buyers of its 54% stake in Madagascar's Ambatovy nickel operation to facilitate its exit from the project. The Japanese trading house has recorded 2.5 billion dollars in cumulative losses and expects a 418 million dollar hit from the transaction.
SUMITOMO CORP financed the sale of its 54% stake in a Madagascar nickel operation to facilitate an exit from the project. The Japan-based trading house has booked $2.5B in cumulative losses over two decades from the Ambatovy project. The deal allows Sumitomo to offload a chronic underperformer while retaining specific nickel offtake rights.
### Financing a Clean Break Sumitomo funded the transaction to ensure the deal closed, three sources familiar with the matter said. The exit results in a $418 million hit for Sumitomo, reflecting a comprehensive economic assessment of the project. Part of the funding will repair cyclone damage at the facilities, where production has been suspended since February.
