HALISTER: OCI Drops; Outlook More Challenging Without CF Deal: EFG-Hermes

OCI Drops; Outlook More Challenging Without CF Deal: EFG-Hermes

(Bloomberg) -- OCI NV drops as much as 9.6%, biggest intraday decline since Feb. 8; worst performer in SX4P, -0.7%.
  • Volume more than 1x 3-month daily average
  • EFG-Hermes says outlook for OCI “much more challenging” with CF deal off the table
  • Views OCI/CF deal termination “very negatively” as large part of investment thesis on OCI was the proposed merger with CF, which broker expected to be value accretive to shareholders
  • Deal was also expected to relieve OCI’s highly-leveraged balance sheet
  • Notes global fertilizer and methanol prices under “immense pressure” in 2016, cites global oversupply, lower oil prices
  • OCI also released 1Q trading update today with rev., Ebitda down y/y
  • Rates OCI buy
RELATED
  • Earlier: CF, OCI Terminate Proposed Combination of Some Businesses
    • CF says U.S. Treasury announcement on April 4 materially reduced structural synergies of the combination
  • OCI shares down 46% YTD, worst performer on the SX4P index (-9.5% YTD)
Alert: HALISTER
Source: BFW (Bloomberg First Word)

Tickers
OCI NA (OCI NV)
CF US (CF Industries Holdings Inc)
HRHO EY (Egyptian Financial Group-Hermes Holding Co)

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