Eramet plans capital increase, asset sales after dire year

French mining group Eramet will launch a 500 million euro ($590.40 million) capital increase and consider selling stakes in some activities in 2026 after a slump in earnings and a jump in debt last year, it said on Wednesday.

The nickel, manganese and lithium producer unveiled the measures as it also faces a management crisis following the firing of former CEO Paulo Castellari and the suspension of finance chief Abel Martins-Alexandre within a few days earlier this month.

Chair Christel Bories, who has temporarily resumed the CEO role she passed on to Castellari last year, told reporters that the capital increase had been backed by Eramet’s main shareholders – the Duval family and the French state – but terms would be published later.

The company posted full-year adjusted earnings before interest, tax, depreciation and amortization (EBITDA) of 372 million euros, down 54% from 2024, pressured by lower manganese prices, a weaker dollar and nickel production setbacks in Indonesia.

It recorded a net loss, excluding New Caledonian nickel subsidiary SLN, of 370 million euros, partly reflecting a depreciation of 171 million euros for its mineral sands business.

The group will also cut capital expenditure and pursue efficiency measures, as announced by Castellari in early December.

The leadership upheaval has alarmed analysts who had welcomed Castellari’s early efforts to overhaul the group.

While saying their cases were unrelated, Eramet has cited management methods as the reason for Castellari’s dismissal and the suspension of Martins-Alexandre.

The finance chief has been relieved of his duties pending an independent investigation into employee complaints over management of the finance department, Eramet has said.

Eramet is aiming to raise manganese and lithium output this year, while also benefitting from a recovery in metal prices. However, a steep cut to an annual volume authorized by Indonesia has raised uncertainty over its nickel business.

($1 = 0.8469 euros)

(By Gus Trompiz; Editing by Joe Bavier and Kirsten Donovan)