OCI Global Successfully Reaches Bondholder Agreement for Strategic Transaction

OCI Global's Landmark Bondholder Agreement

In a significant development in the financial landscape, OCI Global (Euronext: OCI), a prominent leader in hydrogen production and distribution, has successfully formed a support agreement with a substantial group of bondholders concerning its 6.700% Notes due 2033. This agreement signals a positive shift as OCI navigates through critical business expansions, notably following its recent decision to sell its Global Methanol Business to Methanex Corporation, an arrangement referred to as the MetCo Transaction.

Understanding the Support Agreement

Announced on April 8, 2025, the support agreement encompasses over 60% of the total outstanding principal amount of these bonds, which amounts to a significant USD 600 million. Under this arrangement, OCI is committed to launching a tender offer within five business days post the successful closure of the MetCo Transaction. This tender offer will be positioned on customary terms, presenting a competitive price of 110.75% of the par value, accompanied by accrued and unpaid interest to ensure fairness for the bondholders.

The core aspects of the support agreement include shared responsibilities between OCI and the bondholder group. The bondholders are expected to favorably engage in the tender offer, thereby underscoring their commitment to OCI's strategic initiatives. Importantly, the bondholders have also agreed to back modifications to the Bond documentation, which would permit OCI to redeem these bonds post-transaction closure, enhancing the company's flexibility to manage its capital structure.

CEO’s Outlook on the Deal

Hassan Badrawi, OCI's CEO, expressed his contentment regarding the agreement, highlighting the company's enduring relationship with its bondholders. In his words, "We are delighted to have reached an agreement with a large group of our bondholders, with a view to an orderly pay down of our capital structure upon the closing of the MetCo Transaction." This sentiment reflects OCI's appreciation of investor involvement and their long-standing trust and support.

Badrawi further emphasized that the structured deal aims to be beneficial for all participants, rewarding bondholders appropriately for their faith in OCI over the years. As OCI continues to evolve within the hydrogen sector, such strategic agreements are crucial for maintaining operational stability and fostering appealing investment opportunities in the evolving market landscape.

The Implications of the MetCo Transaction

The MetCo Transaction is poised to play a pivotal role in OCI Global's growth strategy, enabling the company to sharpen its focus on its core hydrogen business while streamlining its operational capabilities. The bondholder agreement complements this strategy by providing the necessary financial measures to ensure that OCI can navigate this transition seamlessly.

As industries worldwide pivot towards cleaner energy solutions and hydrogen technologies continue to gain traction, OCI is positioning itself not just as a producer, but as a transformative player within this vital arena. The partnership forged through the support agreement is a testament to OCI's forward-thinking approach and a commitment to its stakeholders, paving the way for a sustainable and prosperous future.

Conclusion

With the completion of the MetCo Transaction on the horizon, this bondholder agreement signifies more than just a financial arrangement; it highlights OCI Global's strategic foresight in maintaining robust relationships with key investors while ensuring that it is well-equipped to tackle the changing dynamics of energy production and distribution. The commitment from both OCI and its bondholders can be seen as a cornerstone for mutual success, fostering a solid foundation for future endeavors within the global hydrogen market.