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AMSTERDAM - OCI Global (Euronext:OCI), whose stock has surged over 57% in the past year and maintains a "GOOD" overall financial health score according to InvestingPro, has completed the sale of its Global Methanol Business to Methanex Corporation (TSX:MX) (Nasdaq:MEOH) for $1.6 billion, the company announced Friday.
The transaction, first announced in September 2024, includes approximately $1.3 billion in cash and 9.9 million Methanex shares valued at $346 million. The deal gives OCI a 12.9% stake in Methanex, making it the second-largest shareholder in the company.
OCI plans to launch a tender offer for its $600 million 6.700% Notes due 2033 within five business days of the closing, offering 110.75% of par value plus accrued interest.
The company also announced plans to return up to $1 billion to shareholders through 2025 and early 2026. The first tranche of approximately $700 million is expected to be paid by September 5, 2025, through capital repayments and cash dividends.
"Including the proposed $1 billion distribution, we will have returned over $7.4 billion to shareholders since 2021," said Nassef Sawiris, Executive Chairman of OCI.
The divested methanol business includes facilities in Beaumont, Texas, with production capacity of 910,000 tonnes of methanol and 340,000 tonnes of ammonia, a 50% interest in Natgasoline joint venture, and a currently inactive facility in Delfzijl, Netherlands. The business also includes OCI HyFuels, which produces low-carbon methanol.
Morgan Stanley & Co. International served as financial advisor to OCI on the transaction, according to the company’s press release statement.
In other recent news, OCI NV has been actively engaging in strategic changes and financial adjustments. The company announced four major divestments totaling $11.6 billion, with approximately $4.4 billion returned to shareholders. OCI plans further capital distribution of up to $1 billion, contingent on the sale of its Methanol business to Methanex, expected in the first half of 2025. Moody’s Ratings downgraded OCI’s long-term corporate family rating to Ba2, citing a weakened business profile and unclear strategic direction. The company’s credit rating remains under review for potential further downgrades. Berenberg analysts downgraded OCI’s stock from Buy to Hold, with a revised price target of €8.70. Similarly, Citi analysts downgraded OCI from Buy to Neutral, lowering the price target to €8.30, following a significant shareholder return. These developments reflect a cautious outlook on OCI’s stock, despite the company’s substantial net cash position and liquidity.
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