Egyptian contractor Orascom Construction and Euronext-listed investment firm OCI Global, companies controlled by Egyptian billionaire Nassef Sawiris, are evaluating a merger to establish a scalable infrastructure and investment platform.
The combined entity will be anchored in Abu Dubai and will have a global reach, the companies said on Monday.
The move comes just weeks after Orascom Construction listed its shares on the Abu Dhabi Securities Exchange (ADX) after delisting from Nasdaq Dubai. The company moved its offices from Dubai International Financial Centre to Abu Dhabi’s financial hub ADGM.
“OCI and Orascom Construction are exploring a [merger] structure whereby Orascom Construction would be the acquiring ADGM-incorporated and ADX-primary listed entity,” Orascom said.
OCI shareholders would then receive new Orascom Construction shares at a ratio to be determined after completion of reciprocal due diligence and relative valuation.
The deal will be subject to approval by boards and shareholders of both companies as well as final regulatory approval. OCI would subsequently be liquidated and delisted from Euronext Amsterdam, the companies added.
Orascom Construction is a contractor primarily focused on infrastructure, industrial and high-end commercial projects in the Middle East, Africa and the US. It also owns 50 per cent of Besix Group, a company specialising in construction, infrastructure and marine works.
The company, which is dual listed on the Egyptian Exchange, had a contract backlog of $9.6 billion at the end of June, with Egypt dominating the total contract value at 53 per cent, followed by the US at about 28 per cent and Saudi Arabia at 12 per cent.
Orascom said the “periods of greatest value creation” in Orascom and OCI’s history were when their businesses were combined – first in cement and later in natural gas-based industries.
“The combination will unite and enhance the companies’ financial strength, consolidating substantial capital resources and funding capabilities,” the company said.
“This strengthened platform will facilitate investment in large-scale infrastructure opportunities through multiple channels, including equity, credit, and operation and maintenance participation, while leveraging Orascom Construction’s established experience in the space.”
The mergers, the companies said, will “unlock a new phase of growth”.
Orascom Construction, which is involved in the construction of a large-scale water treatment project in Abu Dhabi with Adnoc and Taqa, has also set its sights on expanding its business in Saudi Arabia, Osama Bishai, its chief executive told The National, earlier this month.
It is currently building a 3-gigawatt power plant in the kingdom and is in discussions to start another one, Mr Bishai said.
Orascom is also in talks to construct water-treatment plants in the Arab world's largest economy. “We are focused in Saudi Arabia on essential infrastructure,” he said at the time.
Orascom Construction, whose shares rose as much as 45 per cent on its September 11 trading debut on the ADX, reported a 26.5 per cent annual increase in its net profit attributable to shareholders to $82.7 million. Its revenue for the reporting period jumped more than 32 per cent to $1.95 billion, according to its financial statement.
OCI, which has been involved with building and scaling businesses in fertilisers, ammonia, methanol, cement, and infrastructure, has returned approximately $7 billion to shareholders since 2022, it said.
