Why Cobalt Holdings cancelled its IPO and what it means for EV metals investors

Why Did Cobalt Holdings Cancel Its IPO on the London Stock Exchange?

Cobalt Holdings plc, a privately held investment vehicle focused on physical cobalt assets, announced on June 4, 2025, that it would not proceed with its proposed initial public offering on the London Stock Exchange. The IPO—anticipated to raise approximately $230 million—was positioned to become the largest flotation on the LSE since 2024. Despite backing from Glencore plc (LSE: GLEN), the move was shelved less than ten days after its original announcement.

The abrupt cancellation underscores a broader sense of caution in the UK’s capital markets, particularly in commodity-linked and energy transition plays. Cobalt Holdings’ decision comes amid continued post-Brexit capital market fragmentation, weak risk appetite among institutional investors, and subdued sentiment in the critical minerals sector—despite the booming long-term demand prospects tied to electric vehicle (EV) battery production and renewable energy storage.

Market observers suggest that tepid institutional demand and valuation misalignments played a central role in the withdrawal. According to multiple sources close to the roadshow, the IPO failed to secure the minimum viable investor interest necessary to move forward. For the London Stock Exchange, which has been striving to attract more commodity and clean-tech listings post-pandemic, this decision delivers a symbolic blow.

What Was the Strategic Intent Behind Cobalt Holdings’ Pure-Play Cobalt Model?

Cobalt Holdings plc was established to function as a direct investment vehicle in physical cobalt, decoupled from the operational risks associated with mining operations. Headed by CEO Jake Greenberg—co-founder of the uranium investment vehicle Yellow Cake plc (LSE: YCA)—Cobalt Holdings adopted a similar structure, aiming to create a long-term holding company of cobalt metal stockpiles.

Rather than exploring or mining cobalt, the company would purchase and hold physical cobalt from reputable sources, enabling investors to gain clean exposure to cobalt prices. The $230 million capital raise from the IPO would have been used primarily to purchase 6,000 metric tons of cobalt from Glencore at a discounted rate—metal currently worth about $200 million at prevailing market prices. This initial stockpile would then be warehoused and marked to market, forming the company’s core asset base.

This model, already validated in the uranium sector by Yellow Cake’s success, was tailored to appeal to institutional investors and ESG funds wary of exposure to operational and geopolitical risks. With more than 70% of the world’s cobalt supply originating from the Democratic Republic of Congo (DRC), often under conditions of human rights scrutiny, Cobalt Holdings pitched itself as a responsible, supply chain-transparent alternative.

Importantly, the company had entered into a six-year supply agreement with Glencore to access up to $1 billion worth of cobalt metal. The deal provided long-term supply assurance, but not equity certainty. Despite this, the company failed to gain traction during its roadshow phase, suggesting that even strong structural design and credible backing could not offset larger macro and market concerns.

How Did Glencore and Other Investors Factor into the Offering?

Glencore plc, one of the world’s largest producers of cobalt, was both the primary supplier and a planned cornerstone investor in Cobalt Holdings. Alongside Anchorage Structured Commodities Advisor, Glencore was expected to take up to 20.5% of the IPO allocation. This strategic equity support was intended to de-risk the offering, especially for institutional investors seeking commodity-linked returns with minimized operational exposure.

In market terms, Glencore’s cobalt supply contract with Cobalt Holdings added weight to the project’s legitimacy. The six-year commitment also signaled that the trading giant believed in the viability of long-hold strategies in the cobalt market. However, despite this alignment, the support was not enough to shore up investor sentiment.

In the days following the IPO withdrawal, Glencore shares (LSE: GLEN) experienced only marginal volatility, indicating that public investors did not perceive the event as financially material for the commodities major. This aligns with analysts’ expectations that Glencore’s broader trading and mining operations would dilute any one-off exposure to the failed offering.

Why Is London Struggling to Attract IPOs in 2025?

The failed Cobalt Holdings listing adds to growing concerns that London is no longer the IPO destination it once was. Since Brexit, the UK’s capital markets have seen declining new listings, reduced investor confidence, and capital outflows toward jurisdictions like Amsterdam, New York, and Hong Kong.

Cobalt Holdings would have been the most significant LSE IPO since CAB Payments’ listing in 2024. Its abrupt withdrawal now raises new questions about London’s competitiveness in attracting high-profile listings in emerging sectors like critical minerals, climate-tech, and clean energy.

Several companies—including Shein and certain Unilever (LSE: ULVR) divisions—have chosen to list overseas, citing valuation pressures, regulatory frictions, and more vibrant investor ecosystems in foreign markets. This has triggered a reassessment within UK regulatory circles, with the Treasury and Financial Conduct Authority (FCA) actively pursuing reforms to make listing in London more attractive.

Analysts point to this broader market malaise—not necessarily flaws in Cobalt Holdings’ strategy—as the real culprit behind the deal’s failure. “The offering was smartly structured with credible partners,” one investment banker noted, “but it came to market at a time when UK investors were not ready to embrace unorthodox commodity models.”

What Does This Mean for Critical Minerals Investing?

The decision by Cobalt Holdings to withdraw its IPO highlights the tension between long-term thematic enthusiasm and near-term investor caution. While the demand outlook for cobalt remains robust—driven by its use in lithium-ion batteries, grid storage, and aerospace alloys—recent volatility in cobalt prices and uncertainties about alternative battery chemistries have made investors wary.

Cobalt remains a crucial input in nickel-cobalt-aluminum (NCA) and nickel-manganese-cobalt (NMC) battery formulations, widely used by automakers like Tesla (NASDAQ: TSLA), BMW (XETRA: BMW), and Hyundai (KRX: 005380). Yet the rising popularity of lithium-iron-phosphate (LFP) batteries, which do not require cobalt, has raised questions about long-term demand saturation.

Furthermore, the geopolitics of cobalt sourcing have become increasingly fraught. More than two-thirds of global cobalt is extracted from the DRC, where artisanal mining, supply bottlenecks, and ESG concerns pose long-term challenges. The industry’s attempts to build more transparent and sustainable supply chains remain a work in progress.

From a strategic standpoint, Cobalt Holdings was well-placed to address these concerns. By acquiring cobalt through transparent contracts from Glencore and storing it in secure, regulated warehouses, it offered institutions a clean pathway into an otherwise murky market. But despite this, public capital flows failed to materialize—suggesting that institutional money remains hesitant to engage with physical-commodity investment vehicles without precedent or liquidity safeguards.

Will Cobalt Holdings Explore Private Funding or Strategic Alternatives?

Although the IPO has been shelved, Cobalt Holdings is reportedly not abandoning its ambitions. Sources close to the company indicate it may now pursue private capital alternatives, including sovereign wealth fund participation, infrastructure-focused private equity, and specialist commodity funds. The six-year Glencore supply contract remains in place, allowing the company to still acquire and warehouse cobalt gradually.

Such a move could allow the firm to build credibility and performance history before returning to the public markets. Alternatively, the company might consider reverse mergers or special purpose acquisition company (SPAC) structures in more receptive jurisdictions, including North America or Australia.

Analysts suggest that while the public market route is blocked for now, demand for long-duration cobalt assets will continue to rise as EV and defense sector demand grows. The recent surge in U.S. Department of Energy funding for domestic cobalt processing, as well as rising aerospace applications for cobalt-based superalloys, support the thesis that prices may rebound over the medium term.

How Has Market Sentiment Reacted to the IPO Withdrawal?

From a sentiment analysis perspective, the IPO withdrawal has been met with cautious indifference by broader financial markets. There was no significant shift in cobalt-related ETFs, nor did equities of cobalt miners or battery manufacturers show material movement. However, investor sentiment toward LSE-based IPOs has cooled further, with fund managers reportedly more focused on defensives and high-yield plays in the current macro environment.

There was no immediate FII (foreign institutional investor) or DII (domestic institutional investor) repositioning linked to the Cobalt Holdings development, indicating that the market views this as an isolated event rather than a systemic concern.

For now, analyst recommendations across the broader critical minerals segment remain neutral, with a tilt toward Hold for diversified miners and Buy on dips for battery metal ETFs, especially those with exposure to lithium and nickel, which continue to show stronger supply-demand fundamentals.

What’s Next for Cobalt Holdings and the Broader Critical Metals Market?

Despite the IPO setback, Cobalt Holdings’ core proposition remains relevant—particularly as the world accelerates its transition to electrified transport, green infrastructure, and supply chain resilience. While public equity investors hesitated this time, private capital may seize the opportunity to back a low-competition asset in a high-demand niche.

If investor education, market conditions, and cobalt price stability improve over the coming quarters, the company could revisit a public listing or expand its warehousing model through joint ventures. Meanwhile, London’s capital markets must reckon with the reputational costs of such high-profile withdrawals and strive to rebuild credibility among the next wave of innovative issuers.