UPDATED: Li-Cycle Holdings Corp.’s CEO and president Ajay Kochhar has stepped down from the board of directors, and will also leave his roles as president and CEO as the company seeks buyers for its business or assets.

News of the board departure came Friday morning, a day after the Toronto-based battery recycling company announced it requires financing to repay its liabilities, despite extended waivers for its convertible notes from Glencore Canada Corporation and Wood River Capital.

Kochhar, also a co-founder of the company, will transition into a senior advisory role to support Li-Cycle’s sales process starting May 15. Following him in stepping down is CFO Craig Cunningham.

Michelle Faysal is joining Li-Cycle as the interim CFO, and William Aziz has been appointed chief restructuring officer by the company’s board. Aziz has over 35 years of corporate restructuring experience, according to the Friday release, with roles in the restructuring of Walter Energy Canada and U.K., The Toronto Star Group and U.S. Steel Canada (now Stelco Holdings Inc).

Li-Cycle (LICYF) has been beset with financial and operational problems, including construction on its Rochester Hub in New York state being delayed, major layoffs, facility closures, pauses on its global network of recycling facilities, and large impairment charges.

Global mining company and Li-Cycle investor Glencore proposed to acquire Li-Cycle in March. But Li-Cycle’s directors have not yet found a transaction or alternative in the company’s best interests, the release says, so it may need to “significantly modify or terminate its operations and may need to dissolve and liquidate its assets under applicable insolvency laws or otherwise file for insolvency protection.”

Li-Cycle is retaining Northbrook, Ill.-based Hilco Corporate Finance to help it find potential buyers.

Li-Cycle’s facilities and finances

Li-Cycle oversees a web of facilities in North America and Europe called the Spoke & Hub model. At its Spoke facilities, lithium-ion batteries are shredded to output black mass, which contains valuable metals such as lithium and nickel. At its Hubs, the black mass is further refined into battery-grade materials that can be reused in new batteries.

The company had operated Spokes in Arizona and Alabama, but in Friday’s announcement, Li-Cycle said it will begin curtailing operations at those two locations. Approximately 85 employees will be furloughed as a result. A Spoke in Rochester is curtailed.

Li-Cycle will keep its Spoke in Germany operational.

Plans for a Spoke in Norway are said to be “paused indefinitely”. Its Spoke in Kingston, Ont., also the company’s first commercial recycling site, was closed in November 2023.

Li-Cycle’s planned Hub facility in Rochester, called a “cornerstone asset” by Kochhar, has been a source of troubles for the company after construction costs swelled dramatically, holding construction.

A loan facility with the U.S. Department of Energy to help finance the project closed at up to $475 million (all figures US) in November 2024, $100 million more than originally announced in February 2023, to help restart construction. However, that has not been enough to alleviate the company's overall financial distress.

As of Dec. 31, 2024, Li-Cycle reported $861.2 million in assets, largely made up of its properties, plants and equipment. Its liabilities stood at $598.1 million, primarily convertible debt.

The company ended 2024 with $31.9 million in cash and operated at a net loss of $137.7 million.