OCI N.V. and Abu Dhabi National Oil Company (ADNOC) announced the completion of their transaction to combine ADNOC’s fertiliser business into OCI’s Middle East and North Africa (MENA) nitrogen fertiliser platform, creating a new joint venture.
The combined company, which has been named Fertiglobe and is headquartered in the international financial centre Abu Dhabi Global Market, has over $1.7 billion of annual revenues based on 2018 pro forma figures. OCI will fully consolidate the combined business, ADNOC said in a statement.
Fertiglobe will be the largest export-focused nitrogen fertiliser platform globally, and the largest producer in the MENA region with a production capacity of 5 million tons of urea and 1.5 million tons of merchant ammonia.
It is underpinned by a young asset base and a robust storage and distribution infrastructure with access to key ports on the Mediterranean, Red Sea and Arabian Gulf. Fertiglobe’s complementary production and distribution locations bring geographic diversity and enhanced market access, benefitting both existing and new customers.
Following the close of the transaction, Fertiglobe will focus on the integration of the two businesses, which is expected to create significant value through the unlocking of commercial and technical synergies.
H.E. Dr Sultan Ahmed Al Jaber, UAE Minister of State, CEO of the ADNOC Group and Chairman of the new joint venture, Fertiglobe, said: “The efficiency we have shown in completing this milestone transaction so quickly is a strong indication of the way that Fertiglobe will operate in the future and a hallmark of what we hope to achieve by combining ADNOC’s fertiliser platform and OCI’s MENA-based fertiliser assets. We have laid careful groundwork to extract and promote synergies throughout our strategically placed production assets and distribution network. Working alongside our partner OCI, we look forward to significantly growing our newly combined fertiliser businesses, accessing new markets and bringing significant benefits to all our customers. The close of this transaction is yet another example of the further progress that ADNOC is making in delivering on its 2030 strategy and specifically its ambitions to expand its Downstream portfolio.”
Nassef Sawiris, CEO of OCI N.V. and CEO of the new joint venture commented: “I am very pleased that we have completed this landmark transaction in such a short time frame, which brings together two like-minded partners. It underscores our commitment to create value in the fertiliser industry, at the same time helping develop a more efficient market place for our customers. This platform has a solid financial profile and has significant potential for future growth and value creation, with the support and under the guidance of its two key shareholders.”
This transaction will place the companies EBIC, EFC, Sorfert, and Fertil (formerly ADNOC Fertilisers) under the ownership of the joint venture Fertiglobe, an ADNOC-OCI company.