Sumitomo to exit Madagascar nickel project; shares hit record high

Sumitomo Corp said it will exit the Ambatovy nickel project in Madagascar, ending a long struggle with one of its most troubled overseas mining investments.

Reuters reported the announcement on May 1, with Bloomberg saying Sumitomo plans to sell its majority stake in the project in the first half of the fiscal year ending March 2027. The company holds a 54.17% stake in Ambatovy, according to the research materials.

The move comes after years of operational setbacks. Sumitomo had already said in February that Cyclone Gezani damaged the project and that operations were suspended while the company assessed the impact. Earlier disclosures also showed the project had gone through restructuring in 2024.

The exit news was welcomed by investors. Reuters-linked coverage said Sumitomo shares rose to a record high, with one report citing a gain of more than 17%.

It was not immediately clear who would buy the stake or what conditions would need to be met before the sale closes. Sumitomo has not yet detailed any revised earnings forecast tied to the divestment.

Ambatovy has been one of the biggest and most closely watched nickel projects in Madagascar, and Sumitomo's withdrawal marks a major reset for the asset's ownership and future operating plans.