OCI (OTCPK:OCIN.F) M&A Announcement Transcript

Summary of OCI and Orascom Construction Strategic Combination Call Company and Industry Overview - Companies Involved: OCI (OTCPK:OCIN.F) and Orascom Construction - Industry: Infrastructure and Construction Core Points and Arguments 1. Strategic Combination Announcement: OCI is pursuing a combination with Orascom Construction to create a scalable infrastructure and investment platform based in Abu Dhabi with global reach [3][4][12] 2. Share Distribution: OCI will receive 47% of the fully diluted outstanding shares of Orascom Construction for distribution to its shareholders [3][12] 3. Value Creation Journey: The combination is seen as a pivotal point in OCI's value creation journey, with a focus on maximizing asset valuation through strategic sales and distributions totaling $7 billion over the last four years [4][5] 4. Liquidation Analysis: A liquidation scenario was evaluated, showing a materially lower value than the proposed combination, emphasizing the benefits of preserving asset value and avoiding restructuring costs [5][21] 5. Governance and Fairness: An independent transaction committee was established to ensure governance protocols were followed, with independent advisors providing fairness opinions on the exchange ratio [6][8][12] 6. Rebranding and Structure: The combined entity will be rebranded as Orascom, focusing on infrastructure, construction, and capital investment, aiming for sustainable income and long-term returns [9][10] 7. Financial Position: OCI's net debt position was reported at approximately $59 million, with expectations of future cash inflows from ongoing projects [17][26] 8. Regulatory Approvals: The transaction is subject to shareholder approval at EGMs scheduled for January 22, 2026, with no anticipated regulatory impediments [12][18] 9. Shareholder Concerns: Concerns were raised regarding the lack of a cash alternative for minority shareholders and the implications of a 15% Dutch withholding tax on the share distribution [31][58] Additional Important Points 1. Independent Valuation: The valuation of $1.35 billion was based on a fair market approach, considering both assets and liabilities, and was independently validated [19][41] 2. Future Cash Flow Generation: Future cash flows are expected from OCI's remaining assets, including stakes in Methanex and other operational assets [29][30] 3. Support for Minority Shareholders: Mechanisms are in place to assist minority shareholders in managing their holdings, including voluntary sale facilities and suspense accounts for shares [33][34] 4. Market Reaction: There is an acknowledgment of short-term volatility in the stock market following the announcement, with measures taken to support investors [59] This summary encapsulates the key discussions and insights from the OCI and Orascom Construction strategic combination call, highlighting the strategic rationale, governance measures, and financial implications of the proposed merger.