Sherritt, Hurt by `Cuba Discount,' Plans to Expand on Island
By Dale Crofts
Oct. 4 (Bloomberg) -- Sherritt International Corp., a Canadian company
that produces nickel and oil in Cuba, plans to expand on the island
nation because executives are confident the investment will be safe
after Fidel Castro cedes power or dies.
Nickel production at Sherritt's Moa facility in Cuba will rise almost 50
percent to 50,000 tons a year by about 2010, Chief Financial Officer Guy
Bentinck said today at a conference in Toronto. The company also will
produce more than 20 percent of Cuba's electricity within the next few
years, he said.
Shares of Sherritt trade at a discount because of its joint ventures in
Cuba, Bentinck said. The executive said he is counting on the company's
investment in key parts of Cuba's economy and relationships with the
government and workers to secure its investments after Castro leaves
office, he said.
``Our relationships in Cuba are exceptional, and no matter who's in
power, that will continue,'' Bentinck said. ``We operate all the assets
and control the technology, that's one of the reasons that our position
is so strong in Cuba.''
Shares of Sherritt are discounted because its business in Cuba prevents
it from accessing U.S. capital and markets, Bentinck said.
Sherritt fell 11 cents, or 1.1 percent, to C$9.72 ($8.63) at 2:50 p.m.
on the Toronto Stock Exchange. Before today, the stock had fallen 2.7
percent this year.
Castro on July 31 said he was handing over power temporarily to his
brother Raul after undergoing surgery, the first time he had ceded
control of Cuba in 47 years. Since then, the ailing dictator has
appeared in photos published on his 80th birthday, on Aug. 13, and in
video footage. He also has been visited in hospital by Venezuelan leader
Hugo Chavez.
To contact the reporter on this story: Dale Crofts in Chicago at
dcrofts@bloomberg.net .
Last Updated: October 4, 2006 14:58 EDT
http://www.bloomberg.com/apps/news?pid=20601082&sid=a3Vpxtbo3LsU&refer=canada
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