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OCI Global Announces Agreement for the Sale of its Global Methanol Business to Methanex
Monday, 09 September 2024    8 Min Read
OCI Global Announces Agreement for the Sale of its Global Methanol Business to Methanex

OCI Global ("OCI", the "Company") has entered into a binding equity purchase agreement for the sale of 100% of its equity interests in its Global Methanol Business ("OCI Methanol") to Methanex Corporation ("Methanex"), (the "Transaction").Purchase price consideration of USD 2.05 billion on a cash-free and debt-free basis ("Enterprise Value" or "Transaction Consideration") following a competitive process.The Transaction Consideration will be paid through a combination of approximately USD 1.15 billion of cash (taking into account expected net indebtedness) subject to customary closing adjustments, and the issuance of 9.9 million of common shares of Methanex ("Methanex Shares"). The Methanex Shares provide OCI with the opportunity to participate in potential upside from the Transaction such as improvements in operations of the combined business and potential improvements in the methanol industry cycle. OCI is expected to become an approximately 13 per cent shareholder, and the second largest shareholder in Methanex following the Transaction.The Transaction is expected to close in the first half of 2025 subject to satisfaction of certain regulatory approvals, customary closing conditions, and receipt of OCI shareholder approval. OCI's Board of Directors has approved the Transaction and has recommended that its shareholders approve the Transaction. An agreement to vote for the Transaction has been signed by the largest shareholder of OCI with an interest of approximately 39 percent in the Company.Proceeds from the Transaction will be considered alongside expected proceeds from OCI's previously announced divestitures in IFCo, Fertiglobe and OCI Clean Ammonia (the "Divestitures"). Cumulatively, the Divestitures are expected to crystallize approximately USD 11.6 billion of gross proceeds for OCI and will afford the Company considerable flexibility to unlock value for all its stakeholders. Proceeds will be prioritized to significantly reduce OCI holding company gross debt and to return capital to shareholders. Future guidance on OCI's capital allocation framework will be provided in due course.