ADNOC’s distribution unit sets price range for Abu Dhabi initial public offering

At the top of the price range, the Adnoc Distribution’s initial public offering could be valued at Dh7.375 billion, assuming it sells a maximum 20 percent. (Reuters)
Updated 26 November 2017

ADNOC’s distribution unit sets price range for Abu Dhabi initial public offering

ABU DHABI: Abu Dhabi National Oil Co’s (ADNOC) unit set an indicative price range for its initial public offering (IPO) that could raise as much as $2 billion to become the biggest listing in the UAE since 2007.
ADNOC Distribution set an indicative price range of between Dh2.35 dirham (SR2.40) and Dh2.95, it said in a statement on Sunday.
ADNOC is selling a minimum of 10 percent, or 1.25 billion shares, and a maximum of 20 percent, or 2.5 billion shares, in the IPO of its unit.
At the top of the price range, the deal could be valued at Dh7.375 billion, assuming it sells a maximum 20 percent.
That would make it the biggest IPO in the UAE since 2007 when DP World raised nearly $5 billion, according to Thomson Reuters data.
The planned listing comes as Abu Dhabi is pushing its state companies to float on the bourse, hoping to lure foreign investors with privatizations after a fall in oil prices since mid-2014 depleted its coffers.
The unit’s total market value could be between $8 billion and $10 billion.
Analysts had earlier valued the total fuel distribution unit at between $11 billion and $14 billion in reports prepared by banks advising the firm on the planned listing, sources had told Reuters earlier.
The company valuation implies a 2018 dividend yield of 6 percent to 7.5 percent and a 2019 dividend yield of 4 percent to 5 percent.
ADNOC’s CEO Sultan Al-Jaber said in the statement that the IPO’s price range was compelling and it was an attractive dividend prospect. Investors are getting a unique opportunity to invest in the UAE’s number one fuel retail brand, he said.
Under his leadership, ADNOC has embarked on a major shake-up plan to privatize its services businesses, venture into oil trading and expand partnerships with strategic investors.
ADNOC Distribution is the leading fuel distributor in the UAE, with a market share of around 67 percent in the country by number of retail fuel service stations.
Abu Dhabi’s national oil company earlier this month unveiled details of ADNOC Distribution’s listing, as Gulf states step up plans to privatize energy assets in an era of cheap oil.
Saudi Arabia plans to list 5 percent of Aramco by the end of next year, which Saudi officials say could raise $100 billion, making it the world’s biggest IPO.
Citigroup, First Abu Dhabi Bank, HSBC and Bank of America Merrill Lynch are joint global coordinators for the ADNOC unit’s offer and bookrunners alongside EFG Hermes, Goldman Sachs and Morgan Stanley. Rothschild is the sole financial adviser.

France ready to take Trump’s tariff threat to WTO

Updated 08 December 2019

France ready to take Trump’s tariff threat to WTO

  • Macron government will discuss a global digital tax with Washington at the OECD, says finance minister

PARIS: France is ready to go to the World Trade Organization to challenge US President Donald Trump’s threat to put tariffs on French goods in a row over a French tax on internet companies, its finance minister said on Sunday.

“We are ready to take this to an international court, notably the WTO, because the national tax on digital companies touches US companies in the same way as EU or French companies or Chinese. It is not discriminatory,” Finance Minister Bruno Le Maire told France 3 television. Paris has long complained about US digital companies not paying enough tax on revenues earned in France.

In July, the French government decided to apply a 3 percent levy on revenue from digital services earned in France by firms with more than €25 million in French revenue and €750 million ($845 million) worldwide. It is due to kick in retroactively from the start of 2019.

Washington is threatening to retaliate with heavy duties on imports of French cheeses and luxury handbags, but France and the EU say they are ready to retaliate in turn if Trump carries out the threat. Le Maire said France was willing to discuss a global digital tax with the US at the Organization for Economic Cooperation and Development (OECD), but that such a tax could not be optional for internet companies.

“If there is agreement at the OECD, all the better, then we will finally have a global digital tax. If there is no agreement at OECD level, we will restart talks at EU level,” Le Maire said.

He added that new EU Commissioner for Economy Paolo Gentiloni had already proposed to restart such talks.

France pushed ahead with its digital tax after EU member states, under the previous executive European Commission, failed to agree on a levy valid across the bloc after opposition from Ireland, Denmark, Sweden and Finland.

The new European Commission assumed office on Dec. 1.