Adnoc, OCI plan Fertiglobe IPO, list on Abu Dhabi bourse
Two firms likely to raise $1 billion through 13.8% stake sale
The Abu Dhabi National Oil Company (Adnoc) and chemical producer OCI plan to sell 13.8 per cent of shares in fertiliser joint venture Fertiglobe through an initial public offering (IPO)on the Abu Dhabi Securities Exchange (ADX).
Set to open on October 13 after regulatory approvals, the IPO is open to UAE citizens and residents, as well as domestic and international institutional investors.
Formed in September 2019, OCI owns 58 per cent in Fertiglobe while the remaining 42 per cent is controlled by Adnoc. It operates four production facilities across the Mena countries including UAE, Egypt and Algeria, creating a single platform that has the largest net ammonia export production capacity in the region.
Fertiglobe is the world's largest seaborne exporter of urea and ammonia combined, the largest nitrogen fertiliser producer in the Mena region by production capacity, and an early mover in clean ammonia.
In April, Reuters had reported the two companies could raise at least $1 billion through Fertiglobe IPO.
"The launch of Fertiglobe’s IPO follows the very recent and highly successful listing of Adnoc Drilling on the Abu Dhabi Securities Exchange, exemplifying Adnoc’s pivotal role in driving the growth and diversification of the nation’s economy, supporting the further development of the UAE’s private sector and equity capital markets, and attracting foreign direct investment into Abu Dhabi and the UAE,” said Dr Sultan Ahmed Al Jaber, UAE Minister of Industry and Advanced Technology, Adnoc managing director and Group CEO and chairman of Fertiglobe.
“The offering will be the first listing of a free zone company onshore in the UAE and is open to all citizens and residents of the UAE as well as local and international institutional investors in a number of countries… Adnoc, like OCI, will remain a long-term and committed major shareholder in Fertiglobe and will continue to partner with the company on emerging opportunities, including the development of a new state-of-the-art blue ammonia project at Ta’ziz in Ruwais,” said Al Jaber.
It is estimated that the demand for low carbon ammonia is expected to increase from zero now to approximately 26 million tons in 2030, and 40 million tons in 2035. In addition to developing its low-carbon ammonia capabilities, Fertiglobe plans decarbonisation by investing in low carbon initiatives to meaningfully contribute to OCI’s stated emission reduction target of 20 per cent by 2030.
“Fertiglobe continues to show the multitude of benefits we envisaged when we created it and Fertiglobe is increasingly becoming the ideal platform to capture the opportunities offered by the emerging yet rapidly growing hydrogen economy and generate strong cash flows,” said Nassef Sawiris, executive chairman of OCI NV and vice-chairman of Fertiglobe.
Ahmed EL Hoshy, OCI NV CEO and Fertiglobe CEO, said the company has the potential to offer attractive future dividends underpinned by a robust free cash flow profile throughout commodity cycles.
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