Chemanol completes regulatory procedures for acquiring 80% in GCI

Logo of Methanol Chemicals Co. (Chemanol)

Methanol Chemicals Co. (Chemanol) announced the completion of all regulatory procedures for the transfer of ownership of 80% of Global Co. for Chemical Industries Ltd. (GCI), besides fulfilling all legal documents and obtaining approvals from relevant authorities in this regard.

In a statement on Tadawul today, May 19, the company clarified that the deal is valued at SAR 80 million, to be paid partially and within specified intervals as per the conditions in the previously-signed sale and purchase agreement (SPA), based on achieving the agreed-upon performance indicators that meet the targeted return on investment.

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The company stated that this planned acquisition aims to expand its share in the specialized chemicals sector and diversify its product portfolio, in line with its strategic and expansion plans.

The move would enhance the company’s business and products not prone to fluctuations in feedstock prices and the economic cycles of the petrochemical market.

It also shall also cut the production costs of the acquired company by integrating its services with Chemanol and supplying some materials needed for its production operations. Some of GCI’s products will also be used in Chemanol's production processes.

Chemanol expects the financial impact of the potential acquisition to appear in the second quarter of 2024, noting that the delay from the previously announced completion date was due to financial and legal due diligence procedures.

In June 2023, Chemanol signed two binding offers to acquire 84% of ADDAR Chemicals Co. (ACC) and 80% of GCI, Argaam’s data showed.