Special situations across equities and credit: distressed, M&A, activist, spinoffs. NYC based. Not investment advice.
New York, NY
Joined August 2017
- Tweets53
- Following434
- Followers336
- Likes2.2K
$OCI.AS $OCINF OCI Global announces sale of its European Nitrogen distribution assets for EUR 290M (USD $330M or $1.60/share), still reviewing strategic alternatives for its EU Nitrogen production assets.
Seems like a good result. I had the total EU Nitrogen business (both production and distribution assets) at $2-3.50/share. And I think a positive development for the ultimate combination with Orascom... will be more difficult for controlling shareholders to force a bad deal for the remaining assets when it's just a cash box.
$OCINF
OCI Global is currently trading at ~$7.50/share, while there’s clear line-of-site to ~$10/share in net asset value by end of 2025 *excluding* the value of its European Nitrogen business, which I estimate could be worth an additional $2-$3.50/share.
The Company is currently evaluating strategic options for both the EU Nitrogen business and OCI as a whole.
EU Nitrogen is Europe’s second-largest integrated nitrates fertilizer producer and a global leader in melamine – plus it owns a strategically located ammonia import terminal in the port of Rotterdam.
At current prices, you are effectively getting this business for less than free.
I first wrote about this idea in December 2024 and recently posted my updated thoughts – link below.
$QVCGA $QVCGP
QVC drew down nearly all of its revolver post Q2.
QVC Inc. leverage at 3.9x as of June 30, expected to brush up against 4.5x covenant cap with Q3 earnings ended Sep 30.
China trade truce set to expire on Aug 12th, where QVC sources ~50% of its US product. Mgmt trying to reduce that to <33% by year-end.
$1.1B deferred tax liability related to exchangeable bonds issued 25 years ago that no one is quite sure how will be treated in a full reorg scenario.
A lot going on operationally and strategically at QVC. I think we see a transaction announcement after we get more certainty on tariffs and they can come to an agreement with lenders. If they can squeak by Q3, then they probably wait until after Q4 to see how the holiday season plays out?
I still own some $QVCGP but took off some exposure given my uncertainty on the tax liability.
