ADNOC announces 10% IPO of distribution unit

Abu Dhabi National Oil Co. (ADNOC) said Monday it intends to sell at least a 10% in ofs fuel distribution unit, ADNOC Distribution, and list the company on the Abu-Dhabi Securities Exchange (ADX), Kallanish Energy learns.

The initial public offering (IPO) confirmation by ADNOC CEO Ahmed Al Jaber is the first of a number of expected IPOs in the Middle East, most notably Saudi state-owned oil giant Saudi Aramco late next year.

The listing is planned for December 2017, ADNOC said. Offers will be made available to individual and other investors as part of the UAE retail offering, as well as to qualified investors as part of the qualified investor offering. A 5% piece of the offering will be reserved to the Emirates Investment Authority.

As part of its 2030 strategy, ADNOC is engaged in an ambitious transformation program to unlock and create value through partnerships with foreign investors.

"The IPO of ADNOC Distribution represents an important milestone in this new approach and is a natural evolution for the growth and expansion of this exciting retail-focused business," Al Jaber said. “It also presents a unique opportunity for investors to take advantage of the UAE’s attractive and dynamic investment environment.”

The distribution business is the largest fuel retail brand in the UAE, holding a 67% market share of all fuel stations. Among other selling points, ADNOC Distribution benefits from a “stable and predictable UAE retail market pricing regime,” the state-owned parent company said.

The IPO will be coordinated by Citigroup, First Abu Dhabi Bank, HSBC Bank and Merrill Lynch International. EFG-Hermes UAE, Goldman Sachs Group and Morgan Stanley are acting as joint bookrunners for the offering.