Methanex buying OCI Global’s international methanol business in $2.05-billion deal

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If the deal is approved by regulators, OCI will end up owning a 13-per-cent stake in Methanex

A Methanex Corporation plant is seen in Medicine Hat, July 16, 2018. Methanex will be paying US$1.15-billion in cash, issuing US$450-million in Methanex shares and assuming OCI’s US$450-million in debt and leases.of Vancouver is buying Amsterdam-based OCI Global’s international methanol business in a US$2.05-billion deal that expands the Canadian-based company’s U.S. presence.

“We are pleased with the opportunity to achieve a significant ownership position and are highly confident in Methanex’s ability to create enduring value for shareholders,” OCI executive chairman Nassef Sawiris said in a statement. The transaction features OCI’s stake in two methanol plants in Beaumont, Tex., including one that also produces ammonia.

“We believe Methanex is the natural owner of these assets, given how well the two portfolios fit. OCI started a strategic review 18 months ago, meaning the opportunity to consolidate the methanol market in low-risk jurisdictions is unlikely to have appeared again any time soon,” Mr. Isaacson said. On Monday, debt-rating agency Moody’s placed the Vancouver-based company’s ratings under review for downgrade. “Post transaction, we expect Methanex to allocate free cash flow toward debt repayment,” Moody’s said.The latest deal includes a methanol plant in the Netherlands, but the facility has been idle since 2021. OCI HyFuels, a producer of low-carbon methanol, also will be part of the transfer of various assets.

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