Orascom Construction (ORAS) Investor update summary

Strategic rationale

• Combination aims to create a larger infrastructure investment and construction platform, with cash and expertise to pursue larger concessions and investments across the Middle East, U.S., Europe and Australia.

• Management seeks to evolve the business beyond a contractor with concessions; it cited current single-digit earnings multiples versus double-digit multiples for VINCI, Ferrovial and Eiffage.

• Rationale includes OCI’s finance and investment team, whose M&A, financing and asset-disposal experience is expected to strengthen capital allocation and infrastructure investment.

• Management expects cash to support quality, recurring infrastructure growth and help navigate construction cyclicality; greenfield opportunities with growth potential are preferred, though brownfield will also be considered.

Valuation and liquidity

• OCI’s $1.3bn valuation used multiples and DCF approaches; sum-of-parts components include Methanex shares, the AGROFERT terminal deal, OCI Nitrogen and funds linked to clean ammonia completion.

• Management expects tank-sale proceeds by end-Q1 2026, alongside potential Methanex share proceeds and OCI Nitrogen EBITDA or sale proceeds, to build the cash position during Q1-Q2 2026.

• Management indicated gross cash could exceed $2bn by the beginning of Q2, including construction EBITDA; Methanex stake plans will be considered after the entities combine.

• OCI Nitrogen is expected to return to positive numbers; disposal is a priority, subject to antitrust processes, and the valuation includes corporate costs and transitional headcount.

Capital deployment and returns

• Orascom Capital is planned to manage deployable cash and treasury, with investment decisions directed to infrastructure; cash deployment target is within 18-24 months, generally under the infrastructure pillar.

• Initial investment focus is the Middle East and U.S.; European opportunities with Besix may be considered if returns meet thresholds. Management also remains open to AI-and-energy investments.

• Existing concessions are expected to contribute $18m to the bottom line in 2027, including the 900 MW development; financial close for that development is expected in 2026.

• Dividends remain a core cash-allocation pillar; a clear policy is expected after the merger and general assembly process.