Adnoc targets US$2b from unit IPO
DUBAI: Abu Dhabi National Oil Co may raise US$2 billion (RM8.2 billion) from the initial public offering (IPO) of its fuel-retailing unit in an IPO that could be the biggest in the United Arab Emirates (UAE) in 10 years.
The crude producer will price the shares of Abu Dhabi National Oil Co for Distribution PJSC in a range of 2.35 dirhams to 2.95 dirhams (RM3.30), according to an advertisement published in Gulf News. Based on that estimate, the unit is valued at US$8 billion to US$10 billion (RM41.20 billion).
IPO activity in the UAE is showing signs of picking up after only two deals were completed throughout 2015 and last year. Emaar Properties PJSC raised US$1.3 billion from the sale of shares in its development unit earlier this month, while Mubadala Investment Co expects to IPO its Emirates Global Aluminium unit next year.
“This is the first real petroleum-linked issue that has come to the market. That’s huge given that really this region is all about oil,” said Salman Bajwa, the chief executive officer of Emirates NBD Asset Management, yesterday. “The appetite that we have seen among investors, among the retail investors as well as institutions, is huge.’’
Raising US$2 billion would make the Adnoc Distribution share sale the biggest in the UAE since Dubai ports operator DP World Ltd raised US$5 billion in 2007, according to data compiled by Bloomberg.
Adnoc, which pumps most of the crude in the UAE, plans to announce the final offer size and pricing on December 8, with the stock expected to begin trading on December 13 in Abu Dhabi. The final amount could be more in the US$1 billion-US$1.5 billion range, according to a person with knowledge of the matter. The company said last week it planned to offer 1.25 billion to 2.5 billion shares. Bloomberg