Shearman & Sterling advised joint lead arrangers Société Générale and ING Capital LLC on the structured take-private acquisition financing for Pala Investments’ acquisition of Cobalt 27 Capital.
The $195 million financing included a term credit and note purchase facility secured by, among other things, a first lien on the cobalt stream agreement between Cobalt 27 and Vale with respect to Voisey’s Bay. It also involved a borrowing base facility that was secured by a first lien on the cobalt inventory owned by Cobalt 27 and stored in warehouses in Baltimore, Belgium and The Netherlands. The acquisition by Pala Investments of Cobalt 27 resulted in the spinout of Conic Metals Corp. (previously known as Nickel 28).
This transaction represents a relatively rare example of a limited recourse financing in the cobalt sector that combines this variety of facilities.