ADNOC completes $1 billion institutional placement for distribution business

ADNOC completes $1 billion institutional placement for distribution business
ADNOC had been considering selling a bigger stake in its fuel distribution business. (Reuters)
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Updated 14 September 2020

ADNOC completes $1 billion institutional placement for distribution business

ADNOC completes $1 billion institutional placement for distribution business
  • The placement will increase ADNOC Distribution’s free float to 20 percent
  • ADNOC had been considering selling a bigger stake in its fuel distribution business

DUBAI: State-run Abu Dhabi National Oil Company (ADNOC) said on Monday it had completed a placement to institutional investors of 10 percent in its subsidiary ADNOC Distribution’s total share capital, or 1.25 billion shares, valued at $1 billion.
The placement will increase ADNOC Distribution’s free float to 20 percent, and contribute to improved liquidity of the company, ADNOC said in a statement. ADNOC will retain an 80 percent strategic stake in ADNOC Distribution and continues to see strong growth potential in the company, it added.
The transaction represents “the largest block placement of a publicly listed” company in the Gulf region and “leverages significant investor demand for ADNOC Distribution shares,” ADNOC said.
In 2017, ADNOC listed 10 percent of ADNOC Distribution, the largest operator of petrol stations and convenience stores in the United Arab Emirates, on the Abu Dhabi Securities Exchange.
ADNOC had been considering selling a bigger stake in its fuel distribution business, including a secondary listing overseas, after the initial public offering (IPO) in 2017, Reuters had reported.
On Monday, ADNOC said the placement was priced at 2.95 dirham per share, which is 18 percent above the IPO price of 2.50 dirham and represents a 5 percent discount to the company’s 3-month volume weighted average price.
“This transaction highlights the attractive nature of ADNOC Distribution to investors, and ... demonstrates the high-quality investment opportunities offered by ADNOC,” Sultan Al-Jaber, the chief executive officer of ADNOC, said in the statement.
“For the investors, it presented a unique opportunity to access a sizeable stake in ADNOC Distribution ... with an attractive and resilient dividend policy.”
Last month, ADNOC Distribution said its 2020 dividend policy would continue with an increase of 7.5 percent to 2.57 billion dirhams.
Four years ago, ADNOC started a transformation strategy to adapt more quickly to market changes, and the company has said it will continue to work with investors to attract foreign capital and maximize value from its resources.


Tadawul slips 0.3%, Anaam Holding falls, SARCO soars

Updated 8 min ago

Tadawul slips 0.3%, Anaam Holding falls, SARCO soars

Tadawul slips 0.3%, Anaam Holding falls, SARCO soars
  • Tadawul All Share Index falls to below 8,700 points, turnover at $3.14bn

Saudi equities extended their losses, with benchmark Tadawul All Share Index (TASI) slipping 0.3 percent, or 28 points, to close at 8,694 points on Wednesday.

Total turnover reached SAR 11.8 billion ($3.14 billion), with advance-decline ratio at 52:131.

The shares of Almarai Co., Saudi Telecom Co., Riyadh Bank, Banque Saudi Fransi, Yansab and Zain Saudi ended trading today with declines between 1 percent and 2 percent.

Anaam Holding was the top decliner as it went limit down to SAR 154.20. The Securities Depository Center Co. (Edaa) deposited today, Dec. 2, the subscribed securities of Anaam International Holding Group to the accounts of eligible securities' holders.

On the other hand, SARCO went limit up to SAR 105.6 amid trading volume of 6.3 million shares.

Al-Omran shares recorded their highest close since listing, rising 10 percent to SAR 108.8.

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