Sawiris-backed Orascom, OCI Global tee up a cross-border merger: Egypt’s Orascom Construction and Dutch-listed fertilizer player OCI Global — both backed by Egyptian bn’aire Nassef Sawiris — are exploring a potential merger that would combine the two firms to create a single global infrastructure and investment platform based out of Abu Dhabi, according to a joint statement (pdf). Sawiris had said in in February 2024 that he was weighing a full overhaul of OCI, and has since been selling off its assets as it winds down its industrial activity.

The pitch: The idea is to bring together Orascom Construction’s USD 14 bn backlog of projects and strong track record in execution with OCI’s expertise in managing investments and allocating capital. Together, they’d have the balance-sheet muscle to take on major infrastructure projects — financing them through equity, credit, and operations and maintenance. The partnership would target sectors ranging from digital and aviation to power, water, and transport, with projects spanning the US, Egypt, the GCC, and Europe.

The proposal would see ADX and EGX-listed Orascom Construction absorb OCI Global, which will in turn liquidate and delist from Euronext Amsterdam. Sawiris owns 38.8% of OCI Global as of August 2024, and 42.4% of Orascom as of January.

How it will work: Under the agreement, OCI shareholders will swap their stock for newly-issued shares in Orascom Construction at a ratio that will be decided after the parties wrap up due diligence and agree on fair value. The move is still pending board and shareholder clearances as well as regulatory approvals.

What Sawiris said: Sawiris framed the merger as a way to pivot from fertilizers and chemicals toward global infrastructure, leveraging Orascom’s project-delivery record and the more than USD 1 bn in proceeds sitting on OCI’s balance sheet. “We want to focus the next stage of our business on the area we see the biggest [prospects], which is infrastructure,” Sawiris told the Financial Times. Meanwhile, the bn’aire said he plans to invest as much as USD 50 bn into US infrastructure over the next decade, with data centers among the key targets.

OCI Global has been paring back its industrial portfolio through a string of high-profile divestments. In 2023, it agreed to sell its controlling stake in Fertiglobe, its JV with Adnoc, to the Abu Dhabi energy giant for USD 3.62 bn, and offloaded its wholly-owned subsidiary Iowa Fertilizer Company (IFCo) to Koch Ag and Energy Solutions for USD 3.6 bn. A year later, Australia’s Woodside Energy struck a USD 2.35 bn agreement to acquire OCI’s blue ammonia project in Texas, one of the world’s largest such facilities under construction. Later in September, OCI announced the sale of its methanol business in the US and Europe to Methanex in a USD 2.1 bn transaction.

Market reax: Shares of Orascom Construction were up 3.8% on the ADX to close at AED 35.

ICYMI- Orascom Construction made its ADX debut this month, transferring its shares from Nasdaq Dubai. The contractor is the first Egyptian company to pursue a dual listing in Abu Dhabi and Cairo, giving Orascom access to deeper institutional liquidity.

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