OCI sells 50% of OCIN for EUR 55m; put/call on remainder at 7x EBITDA. The EUR 41m average EBITDA suggests a lower exit value than the LTM EUR 105m spike implies.
OCI Global (Euronext: OCI) has agreed to sell 50% of its OCI Nitrogen (OCIN) unit to AGROFERT for an initial payment of roughly EUR 55 million–half of a fixed EUR 110 million enterprise value. The remainder of the asset will be subject to a put/call option exercisable from H2 2029, priced at 7x the two‑year average pro‑forma adjusted EBITDA. That structure turns the transaction into a long‑duration bet on European nitrogen prices. The initial price is a floor; the final exit value depends entirely on how much EBITDA OCIN can produce two to four years from now.
Under the announcement, OCI sells half of Nitrogen Intermediate Holding B.V., the entity that owns 100% of OCIN, for a purchase price equal to 50% of EUR 110 million, subject to customary net debt adjustments and transaction expenses. That values the entire equity of OCIN at roughly EUR 110 million on day one.
AGROFERT takes operational control and majority board representation. OCI retains a 50% economic interest alongside customary joint venture protection rights.
Starting from H2 2029–two years after the expected close in H2 2027–either party can trigger a put or call on the remaining 50% stake. The purchase price will be 7x the two‑year average pro‑forma adjusted EBITDA preceding the exit, multiplied by 50%, minus net debt adjustments.
A buyer using 7x on a depressed EBITDA delivers a lower absolute price than the initial EUR 55 million implies. The net debt that will be subtracted at the second closing–expected around EUR 100 million–further reduces OCI’s net proceeds from the second leg.
The key risk in this structure is that the LTM EBITDA figure looks nothing like the business’s normalized earnings. OCIN generated EUR 105 million in EBITDA over the twelve months to April 2026. The source explicitly warns that Q1 2026 alone contributed EUR 43 million of that total, driven by an “unusual geopolitical environment” and resulting price and cost volatility.
For the put/call option, the applicable EBITDA definition excludes certain non‑recurring items, derivatives results, and ammonia distribution activities. The adjusted average EBITDA for the 2024‑2025 period was just EUR 41 million.
| Metric | Value |
|---|---|
| LTM EBITDA to April 2026 | EUR 105 million (includes EUR 43m in Q1 2026) |
| Adjusted average EBITDA 2024‑2025 | EUR 41 million |
| Implied initial equity value | ~EUR 110 million |
| Potential exit value at 7x EUR 41m | EUR 287 million for 100%, or EUR 143.5 million for 50% |
| Expected net debt at put/call date | ~EUR 100 million |
| Net proceeds to OCI from second leg (before adjustments) | ~EUR 43–143 million (range depends on EBITDA) |
The EBITDA definition gap matters. The source notes the put/call EBITDA includes “several adjustments, inclusions, and exclusions negotiated with AGROFERT” designed to reflect underlying profitability and remove extraordinary items. That means the multiple is applied to a lower base than the LTM figure suggests. Investors who assume the EUR 105 million run rate will persist are ignoring the deal’s own mechanics.
The Initial Transaction is expected to close in H2 2027, subject to:
The timeline gives competition authorities time to review the deal. AGROFERT is a major European nitrogen producer; the combination could raise concerns in certain markets. Delays beyond H2 2027 push back the put/call option date, which starts two years after close. Any regulatory condition that changes the scope of the joint venture–for example, forced divestitures–would also alter the EBITDA trajectory.
OCI shareholders must vote at an EGM. The deal removes a potentially volatile nitrogen asset from OCI’s balance sheet but locks OCI into a two‑year joint venture before a full exit. Shareholders who prefer immediate cash might push back. Management’s case rests on the put/call providing a higher exit price than an outright sale today.
Morgan Stanley & Co. International plc is serving as financial advisor on the transaction. AlphaScala’s proprietary score on Morgan Stanley (MS) stands at 62/100 (Moderate), reflecting a balanced risk profile in the Financials sector. The bank’s involvement suggests the deal structure was stress‑tested across multiple nitrogen price scenarios.
The most favorable scenario for OCI is a sustained nitrogen pricing environment that keeps EBITDA above the EUR 41 million average. If OCIN can generate EUR 60‑70 million annually through 2028‑2029, the 7x multiple delivers a second‑leg payment significantly above the initial EUR 55 million. AGROFERT’s incentive to call the option also increases if the business performs well, because AGROFERT would then capture full control.
Key confirmation signals:
The biggest risk is that the EUR 41 million average proves to be the real normal. If nitrogen prices revert toward 2023 levels (when a global glut depressed margins), the put/call option’s 7x multiple becomes a floor–but a low one. A 7x on EUR 30 million average EBITDA would value the remaining 50% at just EUR 105 million before net debt, leaving OCI with minimal incremental proceeds.
Risk factors to watch:
Net debt of roughly EUR 100 million is a significant drag. If OCIN’s EBITDA falls below EUR 40 million, the net debt‑to‑EBITDA ratio could exceed 2.5x, making the equity value after adjustments negligible. The put/call formula subtracts net debt at closing, so a leveraged balance sheet directly reduces the cash OCI receives.
Key insight: This is not a EUR 55 million cash exit. It is a EUR 55 million down payment on a two‑year joint venture with a deferred payout that could be worth anywhere from EUR 0 to EUR 150 million, depending entirely on nitrogen prices and the EBITDA definition. The deal isolates OCI from operational control but leaves capital at risk until at least 2029.
For investors holding OCI stock, the divestiture reduces the company’s exposure to a cyclical commodity. That simplifies the equity story but adds a contingent asset that will be hard to value until the EBITDA baseline becomes clear. Watch the 2026 full‑year results for OCIN’s standalone EBITDA after adjusting for the Q1 anomaly.
For broader context on how energy costs drive nitrogen margins, see AlphaScala’s commodities analysis and the crude oil profile. Morgan Stanley’s role as advisor is covered on the MS stock page.
Prepared with AlphaScala research tooling and grounded in primary market data: live prices, fundamentals, SEC filings, hedge-fund holdings, and insider activity. Each story is checked against AlphaScala publishing rules before release. Educational coverage, not personalized advice.