Monday 10 December 2018

Adnoc to sell at least 10pc of subsidiary in IPO

ABU DHABI, November 13, 2017

Abu Dhabi National Oil Company (Adnoc) will sell at least 10 per cent shares of its retail fuel stations unit and list them on the local stock exchange, said Chief Executive Officer Sultan Ahmad Al Jaber, kick-starting a round of privatizations in the regional oil industry. 
Speaking exclusively to Bloomberg TV, Al Jaber discussed plans to sell the stake in Adnoc Distribution, which operates fuel stations in the UAE.
The IPO will be open to local and international investors and this signals a new chapter in the growth and development of UAE'c capital markets, Dr Al Jaber said at the Adipec conference.
Adnoc will take all the proceeds from the IPO and remain the majority shareholder. The IPO is expected to support Adnoc Distribution in its new growth strategy.
Adnoc Distribution boasts a pan-UAE network of 360 fuel service stations, including car washes and other car inspection services, as well as 235 Oasis-branded convenience stores, thus making it the largest operator of a retail network in the UAE.

The company is also the leading marketer and distributor of fuels to commercial, industrial and government customers throughout the UAE.

The stake in Adnoc Distribution will be offered via an IPO on the Abu Dhabi Securities Exchange by the end of this year, revealed Dr Al Jaber, the CEO of Adnoc.

The IPO "will offer investors an unprecedented opportunity to invest alongside Adnoc in one of the region’s leading consumer brands," he added.

This is the first time Adnoc is undertaking a public listing for any of its group companies, said the Emirati firm in its statement. The share sale is expected to be one of the largest IPOs in the UAE market for a number of years. Following the IPO, Adnoc will retain the majority shareholding.

Adnoc confirmed key points about its fuel distribution business, such as its leading market share and strong position in the UAE’s fuel service station and distribution market besides its stable fuel retail margins, its pan-UAE network of convenience stores, and its strong, long term supply agreements with the Adnoc Group.

Post IPO, it is expected that the unit would still continue to enjoy strong support from the Adnoc Group.

Adnoc Distribution is currently in the process of finalising all regulatory approvals required for the IPO, including those from the UAE Securities and Commodities Authority and the ADX, said the statement from the company.

The public offer represents an important step forward in Adnoc’s ongoing transformation, and follows on from a group-wide value creation initiative launched by Dr Al Jaber earlier this year.

In July, Adnoc announced that it would be taking a more proactive approach to managing its business assets and capital, to unlock value, drive business and revenue growth, optimise performance, and secure greater access for Adnoc products in new growth markets.-TradeArabia News Service

Tags: IPO | ADNOC Distribution |

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