Investors bought Cobalt 27 for its massive stockpile — now they’re being asked to cash out just as cobalt prices are poised to surge – by Gabriel Friedman (Financial Post – October 4, 2019)

https://business.financialpost.com/

Cobalt 27 Capital Corp., which raised hundreds of millions of dollars promoting cobalt — an obscure metal that’s increasingly in demand because of its use in electric vehicle batteries — announced a new proposal this week to ditch cobalt just as its price rises.

On Tuesday, the company said its largest shareholder Pala Investments Ltd. would offer $4 per share for the company’s cobalt assets up from its earlier $3.57 offer, and also give them equity in a new company, Nickel 28.

“We have responded to the concerns expressed by shareholders and believe we have delivered a significantly improved transaction,” Philip Williams, chairman of Cobalt 27’s special committee said in a press release.

Anthony Milewski, chief executive of the company, was not available for comment. The latest offer comes after Cobalt 27 twice postponed a meeting to tabulate the votes on Pala’s first offer, announced in mid-June, and then spent weeks meeting with shareholders, many of whom had said they would not support the deal.

Even though some analysts believe the market outlook for cobalt is picking up, there remains some uncertainty about supply and demand for the scantily traded metal, and some shareholders now say they will support the buyout.

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