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OCI sells methanol business to Methanex for USD 2.05 bn: Sawiris-backed, Netherlands-headquartered chemicals company OCI Global has sold its entire methanol business — operating in the US and Europe — to Canadian methanol producer Methanex in a USD 2.05 bn agreement, according to a press release (pdf). The transaction is set to be completed in 1H 2025, pending regulatory and shareholder approvals.
What we know: Methanex will make the purchase by paying USD 1.15 bn in cash, in addition to the issuance of 9.9 mn of its shares valued at USD 450 mn, giving OCI a 13% ownership of the company to make it the second largest shareholder. The share purchase aims to help the firms improve their joint operations, as well as consider potential further investments in the methanol industry cycle.
That’s not all: The sale also includes OCI Methanol’s 50% stake in Natgasoline — a JV with Proman — which is subject to the settling of an ongoing lawsuit. The Natgasoline facility — which has been in operation is located in Beaumont, Texas, has been commercialized since 2018 and has an annual capacity of 1.7 mn tonnes of methanol, of which Methanex’s share will be 850k tonnes.
The green connection: OCI Methanol is a major distributor of and producer of green methanol through OCI Hyfuels, with potential for renewable natural gas trading as well. OCI has been restructuring and selling its assets to cut down on debt, returning capital to shareholders, and dedicating raised funds to greener chemicals such as low-carbon ammonia, Reuters writes. OCI’s divestitures as of late have generated around USD 11.6 bn of expected tax-free gross proceeds, CFO Hassan Badrawi said.
Methanex is no stranger to the region: Methanex Egypt was the first to operate a methanol production facility in Egypt in 2011, with a current capacity of 1.3 mn tons per year. Egyptian Oil Minister Karim Badawi met with Methanex officials earlier this week to discuss opportunities to locally produce green methanol. Methanex Egypt is 50% owned by Methanex Corp, while Egyptian state institutions hold 33% and Saudi-based Apicorp owns the remaining 17%.
REMEMBER- Sawiris has big restructuring plans for OCI: Egyptian b’naire Nassef Sawiris — who owns a 38.8% stake in the firm — said he was considering overhauling OCI GlobaI in February, with one of the options being turning the empire into a cash-shell company pursuing acquisitions in new industries. The company sold its blue ammonia project in Texas to Woodside for USD 2.35 bn in August and sold its 50% +1 stake in Fertiglobe — their JV with Abu Dhabi National Oil Company — to Adnoc for AED 13.28 bn (USD 3.62 bn) last December, with the acquisition expected to close later this year. OCI also sold 100% of its USD 3.6 bn stake in the US crop nutrient unit Iowa Fertilizers to US’ Koch Ag & Energy Solutions in the same month.
