ADNOC to buy OCI stake in Fertiglobe for $3.62bn

Abu Dhabi National Oil Company (ADNOC) and OCI Global have inked a sale and purchase agreement where ADNOC will acquire OCI’s entire majority shareholding in Fertiglobe.

The transaction supports the company’s ambitious chemicals strategy and its plans to establish a global growth platform for ammonia, which plays a vital role in the energy transition.

For Fertiglobe, this transaction supports its future growth plans, enabling it to explore new market and product opportunities and expand its focus on clean ammonia as an emerging fuel and hydrogen carrier.

Under the terms of the agreement, ADNOC will purchase OCI’s 51 per cent stake in Fertiglobe for Dhs3.20 per share, representing a total purchase price of Dhs13.28bn ($3.62bn).

The deal incorporates an earn-out mechanism for FY2024 and FY2025, linked to commodity pricing and the free cash flow performance of the Fertiglobe business during the relevant period, according to a statement.

ADNOC shareholding to rise to 86.2 per cent

Following the completion of the transaction, ADNOC’s shareholding in Fertiglobe will increase to 86.2 per cent while the free float traded on ADX will remain at 13.8 per cent.

Khaled Salmeen, executive director, Downstream, Marketing & Trading Directorate at ADNOC, said: “Working in close partnership with OCI since 2018, we have successfully listed and grown Fertiglobe into the world’s largest seaborne exporter of ammonia and urea fertilisers. The agreement reinforces our long-term commitment to Fertiglobe and our continued focus on delivering growth and maximising value for the company’s shareholders.”

The two companies have also signed a memorandum of understanding (MoU) to explore potential cooperation on future growth opportunities for ammonia imports into Europe and product distribution. The transaction is expected to close in 2024, subject to the completion of all necessary legal and regulatory conditions, including anti-trust approvals.