Consolidated Energy - comment
OCI wants to include its 50% stake in Natgasoline in the disposal of its methanol assets to Methanex. OCI has just received a ruling in its favour in the shareholder dispute with Consolidated Energy (CONSOL). The litigation likely relates to the ownership and operation of the 50/50 Natgasoline JV but is confidential. If Natgasoline is sold to Methanex, we estimate the value to CONSOL at $1.1bn for the equity plus compensation for the loss of the operating contract. Whether this would be reinvested or used to reduce debt is not clear. If CONSOL wins an appeal, a buyout of the OCI stake in Natgasoline will be needed, requiring more debt issuance. The ruling will be subject to appeal, but both sides will likely want an amicable resolution.