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OCI Global has agreed to a fourth major disposal, bringing the gross proceeds from its sale of assets to $11.6bn in the course of an ambitious break-up plan.
OCI, a chemical and fertiliser group led by Egypt’s richest man Nassef Sawiris, said on Monday it had agreed to sell its global methanol business to publicly traded Methanex for about $2bn. The deal marks Amsterdam-listed OCI’s fourth transaction since undertaking a strategic review last year.
Sawiris, whose personal assets include the English football club Aston Villa, had already sold off other parts of OCI. Last December, the group agreed to offload two fertiliser holdings for about $3.6bn apiece, to Adnoc and Koch Industries of the US.
Then last month, Australia’s Woodside Energy agreed to pay $2.35bn to buy a low-carbon ammonia project in Texas from OCI.
The sale of the methanol business means the four disposals have been made in less than a year. The Egyptian businessman told the Financial Times in an interview earlier this year that OCI could be turned into a cash-shell company that pursues acquisitions in new industries.
OCI’s methanol business includes facilities in Texas and the Netherlands, and a trading unit. The group is a global leader in producing green methanol such as for road and marine transport.
Methanex, a Vancouver-based company and a big methanol supplier, will take over OCI’s methanol arm for a combination of $1.15bn in cash with the rest in shares in its business. Following the deal, OCI will become Methanex’s second-largest shareholder with about 13 per cent of the expanded company.
Following the four sales of business units, OCI still retains European assets.
The deals follow a strategic review approved last year by OCI’s board of all business lines as well as its Netherlands listing venue, after the activist investor Jeff Ubben bought a 5 per cent stake in the company.
Ubben pressed the group to explore options, including asset sales to improve shareholder returns.
OCI said on Monday that deal proceeds would be prioritised to cut its holding company debt and return capital to investors. “Future guidance on OCI’s capital allocation framework will be provided in due course,” the group added in a statement.
In its end-of-year earnings for 2023, OCI said it would distribute at least $3bn to shareholders this year.
Shares in OCI have gained about 8 per cent this year, giving it a market value of €6bn. The stock of Methanex, which is traded publicly in Toronto and on Nasdaq, has fallen about 10 per cent over the same time giving the company around a $3bn market capitalisation.