An agreement between the state-owned energy company and OCI could be announced as soon as the coming days.
Sunday 16, June 2019
(Bloomberg) --Abu Dhabi National Oil Company (ADNOC) and Dutch’s OCI are in advanced talks to combine their Middle Eastern fertiliser businesses.
Following media reports about the possible merger, OCI stated that it continually considers strategic initiatives regarding its portfolio, including possible partnerships, indirectly confirming that it is in discussions with ADNOC on possible cooperation relating to each company’s MENA fertiliser assets.
ADNOC has been expanding its downstream operations and bringing in partners for businesses including its pipeline network and refining unit. It has also listed its distribution unit and agreed in October to sell a five per cent stake in its $11 billion drilling business to Baker Hughes.
The emirate of Abu Dhabi, home to about six per cent of the world’s crude reserves, has been seeking to diversify an economy that is dependent on oil.
The potential tie-up with OCI, run by Egyptian billionaire Nassef Sawiris, comes as the fertiliser industry starts to recover after a spurt of plant expansions swamped the market with new supply.
ADNOC fertilisers sell its products to local and international markets, including the Indian subcontinent, the US as well as Latin America, Australia and Europe. French energy giant Total holds a 33 per cent stake in ADNOC fertilisers.