In terms of financing, Methanex will fund the transaction with a mix of cash reserves and new debt financing from the Royal Bank of Canada. The companies expect the transaction to close by June 2025, pending approval from more than 50% of OCI shareholders and regulatory bodies.
Methanol Industry Impact
Both OCI and Methanex emphasized the strategic importance of the transaction, citing the critical role of methanol and ammonia in supporting industries aiming to reduce carbon emissions. OCI Methanol operates key processing facilities in Beaumont, Texas, and Delfzijl, Netherlands, as well as a low-carbon methanol business known as HyFuels.
Methanex’s CEO Rich Sumner highlighted the strategic advantages of the Beaumont plants, stating they “benefit from access to North America’s abundant and favorably priced natural gas feedstock” and are expected to boost global methanol production by over 20%.
Shareholder Support and Future Plans
OCI’s board of directors has endorsed the deal, and its largest shareholder, Egyptian businessman Nassef Sawiris, who controls 39% of OCI shares, has signed an agreement to vote in favor of the transaction. OCI said it will use proceeds from the $2.05 billion sale and other asset sales totaling $11.6 billion to return capital to shareholders and reduce its gross debt.
Looking Forward
OCI’s $2.05B methanol biz sale represents a significant move in the company’s broader strategy to optimize its financial structure. Methanex, listed on the Toronto Stock Exchange, expects to integrate the new assets smoothly, enhancing its position as the world’s largest methanol supplier. The deal will also provide OCI with long-term value through its stake in Methanex and potential improvements in the global methanol market.
