Electra Battery Materials Restructures $40M Debt, Secures $30M Financing for North America's First Cobalt Refinery

Electra Battery Materials has launched a $40 million debt-to-equity conversion plan, reducing debt by 60%, and a $30 million financing package. The restructuring aims to fund the development of North America's first battery-grade cobalt refinery, crucial for bolstering domestic supply chains. However, the plan imposes significant dilution on current shareholders and grants lenders board representation. The transaction is set to conclude following a special meeting in October 2025.

Electra Battery Materials Corporation (NASDAQ: ELBM; TSX-V: ELBM) has announced a significant restructuring plan aimed at securing the funding required to advance North America's first battery-grade cobalt refinery. The company has launched a $40 million debt-to-equity conversion plan, reducing its convertible debt by 60%, and a $30 million financing package. The restructuring aims to bolster the domestic supply chain for critical battery materials.

The debt-to-equity conversion will significantly reduce the company's debt burden, while the $30 million financing package includes a conditional commitment from the lenders. This restructuring is designed to strengthen Electra's capital structure and provide the necessary funds to complete the construction of the cobalt refinery.

However, the plan imposes significant dilution on current shareholders and grants lenders board representation. The transaction is set to conclude following a special meeting in October 2025, pending shareholder approval and lender participation.

Electra's CEO, Trent Mell, commented, "Today marks a turning point for Electra. By equitizing a majority of our debt and securing bridge financing, we are taking decisive action to create a sustainable capital structure and advance the steps required to complete the cobalt refinery." Marty Rendall, the company's CFO, added, "This restructuring is undeniably dilutive and difficult for existing shareholders, but it is both timely and necessary."

The restructuring comes as governments across North America are increasingly focused on securing domestic supply chains for critical minerals. Electra's permitted cobalt refinery is a brownfield asset with a proven flowsheet, strategic partnerships, and most of the critical equipment already delivered to the site. The company is also taking steps to advance its battery recycling platform and broaden its feedstock pipeline.

The company's second quarter 2025 financial reports are available on SEDAR+ (www.sedarplus.com) and its website (www.ElectraBMC.com).

References:
[1] https://www.morningstar.com/news/globe-newswire/9512997/electra-files-second-quarter-2025-financial-reports
[2] https://financialpost.com/globe-newswire/electra-launches-debt-to-equity-conversion-and-us30-million-financing-with-lender-support-to-advance-north-americas-first-battery-grade-cobalt-refinery