đ„New Chapter 11 Bankruptcy Filing - Jervois Texas LLCđ„
Miner succumbs to plummeting cobalt prices.
On January 28, 2025, Jervois Texas, LLC (âJervois Texasâ), Melbourne, AUS-based Jervois Global Limited ($JRV.V) (âJervois Globalâ) and six other affiliates (collectively and together with Jervois Texas and Jervois Global, the âdebtorsâ and together with their non-debtor affiliates, the âcompanyâ) filed prepackaged chapter 11 cases in the Southern District of Texas (Judge Lopez).* The company is âa leading global supplier of advanced manufactured cobalt products, serving customers in the powder metallurgy, battery, and chemical industriesâ and, reminding us to never miss an opportunity to self-aggrandize, proclaims to be âan industry leader in responsible sourcing and environmental performance[.]â Weâre not sure how thatâs relevant to first-day relief, but sure, good on ya, mates.
For those not in the know, itâs rough times in cobalt. Prices have plummeted ~74% from a May â22 high of ~$82,000/metric ton to ~$21,550 today, which the company attributes to âsignificant additional supply from Chinese-owned mines in the Democratic Republic of the Congo.â Just the Chinese-owned ones though. Snark aside, pricing is the culprit behind the debtorsâ woes.
Because cobalt is a commodity, the companyâs stock price has been a more-jagged-but-still-damn-close carbon copy of that nosedive.
With the writing on the wall, an upcoming July â24 bond payment, and March â25 revolver and term loan maturities, the company knew early on it had heaps of work ahead of it.
In Q2 â23, it began discussions with third parties that had expressed an interest in partnership opportunities or the companyâs asset base, which primarily consist of (i) a non-operational mine development in Idaho acquired in July â19, (ii) an operating cobalt manufacturing facility in Kokkola, Finland acquired in â21, and (iii) a non-operational nickel and cobalt electrolytic refinery in SĂŁo Paulo, Brazil acquired in July â22, as well as a non-core nickel and cobalt deposit in New South Wales, Australia.** But as luck would have it, not a single bloke or sheila submitted an actionable proposal, so in early â24, the company put âstrategic transactions across the Companyâs business segments, including through a merger or Company saleâ on the table. Truthfully, weâre not entirely clear on how thatâs substantively any different from what the company had already been doing, but no harm, no foul because it also resulted in diddly squat.