Netherlands-based OCI NV and Abu Dhabi National Oil Co. (ADNOC) on Sept. 30 announced the completion of their transaction to combine ADNOC’s fertilizer business into OCI’s Middle East and North Africa (MENA) nitrogen fertilizer platform, creating a world-leading joint venture operating under the name Fertiglobe.
Fertiglobe will be the largest export-focused nitrogen fertilizer platform globally, and the largest producer in the MENA region, with a production capacity of 5 million mt/y of urea and 1.5 million mt/y of merchant ammonia, the two companies said. The combined saleable capacity represents approximately 10 percent of 2018’s combined ammonia and urea global seaborne exports, according to OCI.
“The new combined company 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,” OCI and ADNOC said in their combined media statement. “Fertiglobe’s complementary production and distribution locations bring geographical diversity and enhanced market access, benefiting both existing and new customers.”
The two companies first revealed their plans in June to combine their Middle East and North African fertilizer assets in a new joint venture (GM June 21, p. 1). The transaction will place the OCI companies EBIC, EFC, and Sorfert, and the former ADNOC Fertilizers (Fertil) under the ownership of the new Fertiglobe joint venture. The new company will have more than $1.7 billion of annual revenues based on 2018 pro-forma figures.
Fertiglobe started trading on Oct.1 and is headquartered in the international financial center Abu Dhabi Global Market. OCI owns a 58 percent stake in Fertiglobe, and ADNOC a 42 percent stake. The new entity will be headed by OCI NV CEO Nassef Sawiris. OCI will fully consolidate the combined business, which is expected to generate $60-$75 million in annual synergies, predominately through commercial synergies, the companies said.