ADNOC ‘could list stake in fuel retail business in early 2018’

Banks have been mandated for an IPO in ADNOC Distribution, it was reported in July. (Reuters)
Updated 11 September 2017
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ADNOC ‘could list stake in fuel retail business in early 2018’

DUBAI: Abu Dhabi National Oil Co. (ADNOC) could list more than 10 percent of its fuel retail business by early 2018 and one or two more businesses later as part of a major shake-up, sources familiar with the matter said.
The listing for ADNOC Distribution, which manages petrol stations and convenience stores across the UAE as well as bunkering facilities and a lubricant plant, comes as Abu Dhabi and other Gulf states are privatizing energy assets in an era of cheap crude.
ADNOC said in July it planned to float stakes in some of its services businesses, but did not give details.
For ADNOC Distribution, Reuters reported in late July that banks had been mandated for the initial public offering (IPO), citing sources familiar with the matter.
“They are still working on it, there may be other services (to be listed) but it will not be that fast,” said one source.
ADNOC may in future choose to float one or maximum two more businesses such as its drilling arm, National Drilling Company, or energy infrastructure if the IPO of ADNOC Distribution proves successful, several sources familiar with the firm’s plans said.
The partial privatization plan aims to make ADNOC a more competitive and commercially-focused firm, the sources said.
“The value of this is when you take a company through the IPO process you make it efficient, you optimize it, it becomes a better company as a whole,” one said.
The listing of the fuel-retailer business is likely to be on the Abu Dhabi stock exchange and could happen early next year, several sources told Reuters.
An ADNOC spokesman said: “As announced on July 10, ADNOC is expanding its partnership model and creating new investment opportunities across all areas of its value chain.”
“Central to ADNOC’s new approach will be the more active management of its portfolio of assets and businesses. ADNOC is therefore considering the potential IPO of minority stakes of some of its services businesses which have attractive investment and growth profiles,” the spokesman said.
Since the appointment of Sultan Al-Jaber as ADNOC’s chief executive last year, ADNOC — dubbed “a sleeping energy giant” by one source — has launched a major shake-up.
A sharp drop in crude prices since mid-2014 has forced the oil industry to cut costs and look for ways to boost efficiency.
The transformation of ADNOC, a traditionally conservative firm, is also seen as part of an economic reform drive led by Abu Dhabi’s Crown Prince Sheikh Mohammed bin Zayed Al-Nahyan.
“With (oil) prices not expected to increase much and production constrained by OPEC, Abu Dhabi needs to find alternative ways to get value out of its NOC (national oil company),” said Robin Mills, chief executive of UAE-based consultancy Qamar Energy.
“The approach is rather different from Aramco’s, with more focus on subsidiary IPOs, JVs (joint ventures), and bringing in outside financing into select assets. ADNOC has of course always had more attention on partnerships than most other NOCs via the upstream JVs.”
Saudi Arabia plans to list 5 percent of its national oil company Aramco by next year.
ADNOC has already begun consolidating the operations of two oil companies into a new entity, and a merger of three of its shipping and marine services businesses is expected to be completed by the end of the year. It is looking to set up its own trading unit.
ADNOC produces some 3 million barrels of oil per day, or around 3 percent of global production. It also produces more than 9.8 billion cubic feet of raw gas per day, placing it among the largest energy producers in the world.
— Reuters


Mo-Salah to raise DHL flag in the MENA region for developmental and charitable causes

Updated 37 min 4 sec ago
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Mo-Salah to raise DHL flag in the MENA region for developmental and charitable causes

LONDON: DHL Express, the world’s leading express logistics provider, has signed a strategic partnership with Egyptian football superstar Mohamed Salah to become brand ambassador for the Middle East and North Africa (MENA) region for the next two years.
The new collaboration will see the parties working together on a series of marketing activities and corporate social responsibility (CSR) initiatives that reinforce the synergies between the core values of DHL Express as a business and Mohamed Salah as a sportsman and youth-inspirer.
The announcement made late on Wednesday in northern England comes just weeks ahead of Salah’s campaign to lead the Egyptian national team at the World Cup in Russia.
DHL’s CEO in the Middle East and North Africa, Nour Suliman, told Arab News that he was very proud of collaborating with Salah.
“Our partnership with Mo Salah is unique as it is the first contract with an individual player, but also it is a testament to the synergy of core values DHL Express and Mo Salah share — leadership, commitment, teamwork, precision, agility, determination,” he said.
When asked by Arab News about the meaning of this partnership, Salah said: “I am very proud to be the first player to partner with DHL, and I am happy to collaborate with an international brand.”
DHL did not disclose the funds earmarked for its CSR initiatives to be spent in the MENA region, and its region’s CEO said the initialtives to be developed are still a work in progress.
However, DHL said it has already significantly contributed to the development of the countries they operate in within the MENA region.
The company’s work includes supporting charities, working to help orphans, youth development, care and education among other causes.