Adnoc Gas raises stake sale to 5% on high investor demand

Abu Dhabi National Oil Co (Adnoc) on Monday announced that it will increase the stake in its gas business being offered in an initial public offering to five per cent from four per cent.

In a statement, the Abu Dhabi-based energy giant said it also raised the tranche reserved for employees and UAE national retirees of Adnoc Group companies residing in the country to four per cent from two per cent.

Khaled Al Zaabi, Group CFO of Adnoc, made the announcement to increase the stake in the Adnoc Gas offering based on significant investor demand across all tranches.

“We have witnessed substantial investor demand across all tranches, reflecting Adnoc Gas’ status as a key component of Abu Dhabi and the UAE’s energy ecosystem, and a vital contributor to drive decarbonisation and the energy transition in the UAE,” Al Zaabi said.

Assuming all of the shares in the offering are sold, the size of the offering will be approximately $2.4 billion to $2.5 billion (Dh8.6 billion to Dh9.3 billion).

Supportive trading environment

The state energy group also made the decision to create a supportive trading environment for the company’s stock post-admission. As a result, the retail tranche has been increased from 10 per cent to 12 per cent of the offering. However, the remaining 84 per cent of the offering has been reserved for institutional investors.

Al Zaabi said the offering size increase reaffirms Adnoc Gas as a highly compelling investment opportunity and we look forward to welcoming both local and international investors to join Adnoc and partake in the company’s future growth. This listing is another pivotal landmark for the local financial market, as Abu Dhabi continues to attract a wider and deeper pool of global capital, he said.

“We are delighted to announce that we will be increasing the offer size for the IPO of Adnoc Gas, which is set to be the largest-ever market debut on the ADX to date, and also marks the next remarkable milestone for Adnoc and our ongoing value creation journey,” Al Zaabi added.

3.84 billion shares offered

Adnoc is selling roughly 3.84 billion shares in its gas business, equivalent to about five per cent of its issued share capital. Last week, it offered 3.07 billion shares and announced the price range at Dh2.25 to Dh2.43 per share.

The final offer price will be determined through a book-building process and is expected to be announced on March 3 while trading on the Abu Dhabi Securities Exchange is expected to start on March 13.

The subscription period for UAE retail investors will continue until March 1, while the book-building period for qualified investors ends on March 2.

The Abu Dhabi Pension Fund, South Africa’s Alpha Wave Ventures and Abu Dhabi’s IHC Capital Holding are among the cornerstone investors, as well as other Emirati-controlled entities, committing a combined $850 million.

The UAE is among the top 10 gas producers of the world and Adnoc Gas has access to 95 per cent of the country’s natural gas reserves. It supplies more than 60 per cent of the UAE's gas needs and spending heavily on its infrastructure to boost its production capacity.

— muzaffarrizvi@khaleejtimes.com

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