Adnoc Distribution, which intends to list on the Abu Dhabi stock market next month, has opened the subscription of its initial public offering (IPO), setting the pricing between Dh2.35 and Dh2.95 per share.
At this price range and on a 12.5 billion share count, this equates to approximately $8 to $10 billion in equity value, Adnoc Group chief executive Sultan Al Jaber said in a statement.
“The planned IPO of Adnoc Distribution is centered around Adnoc’s recently announced strategy to more actively manage our assets and capital and represents a key milestone in the company’s ongoing transformation,” Mr Al Jaber said. “It will also support the continued evolution of Adnoc Distribution and accelerate growth of the business. Adnoc Distribution has enormous potential and we believe this IPO will help unlock the inherent value in the business. We see multiple areas for growth in the business – new initiatives in fuel retail sales, further expansion and leveraging of our market leading convenience store platform, as well as growing our commercial fuel distribution business and increasing our regional footprint.”
The company, which runs services stations and retail outlets, will list 1.25 billion to 2.5 billion shares - representing 10 to 20 per cent of the total shares of the company - in an offering of two tranches that will open for subscription on 26 November and close on 6 and 7 December, respectively. The first tranche of 5 per cent of the offering is open to local retail investors, while the rest will be offered to government, international institutional investors and high net worth individuals.
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The minimum investment in shares for the retail offer has been set at Dh10,000, with any additional investments to be made in increments of at least Dh1,000. No maximum investment in the offering has been set, according to the statement.
The final pricing announcement will be made on December 8 following a global book-building process with institutional investors. The shares are expected to begin trading on the ADX on December 13.
It is understood that by maximising the proximity of Adnoc’s service stations to most neighbourhoods, the company could turn its convenience stores into the grocery top-up destination of choice. In 2016, the company recorded revenues of Dh17.7 billion and a net profit of Dh1.8 billion, it said in the statement.
Adnoc Distribution also plans to introduce digital services including booking and paying via smartphone app for fuel to be delivered direct to a customer’s vehicle while at home or at work. The creation of a loyalty programme and offering deliveries of LPG cylinders to retail customers will also incrementally boost sales and improve the customer experience.
The IPO offering, meanwhile comes ahead of Saudi Aramco’s planned listing next year, which may raise as much as $100bn as part of a broader diversification strategy by the kingdom that seeks to reduce the country's dependence on oil revenues.
The share float - the world’s largest should it go ahead - has whetted appetite among global fund managers and has brought institutional investor attention to planned IPOs from national oil companies in the region.
Adnoc Distribution currently operates 360 service stations and 235 Oasis-branded convenience stores throughout the UAE. Adnoc’s decision to part privatise the company forms part of its strategic transformation announced in July, which looks to more actively manage assets under its portfolio and form new partnerships.
“This watershed IPO also represents a new chapter in the diversification, growth and development of the UAE’s capital markets, and specifically the Abu Dhabi Securities Exchange,” Mr Al Jaber said. Following the IPO, Adnoc will remain a significant, long term and committed majority shareholder.
Ahead of the planned listing, Adnoc Distribution beefed up its management, bringing in BP’s John Carey as deputy chief executive and Petri Pentti from Dubai-based Emirates National Oil Company - which also operates fuel stations - as chief financial officer.
“We will continue to consider the potential minority listings of some of our services businesses where a listing might be appropriate, as well as, of course, other options,” Mr Al Jaber said. “Our key, overriding objectives are unlocking and maximizing value and performance across the Adnoc Group.”
Rothschild is the financial advisor on the IPO along with Merrill Lynch, Citigroup, First Abu Dhabi Bank and HSBC as joint global coordinators. EFG Hermes, Goldman Sachs and Morgan Stanley are joint bookrunners.
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Roll of honour 2019-2020
Dubai Rugby Sevens
Winners: Dubai Hurricanes
Runners up: Bahrain
West Asia Premiership
Winners: Bahrain
Runners up: UAE Premiership
UAE Premiership
Winners: Dubai Exiles
Runners up: Dubai Hurricanes
UAE Division One
Winners: Abu Dhabi Saracens
Runners up: Dubai Hurricanes II
UAE Division Two
Winners: Barrelhouse
Runners up: RAK Rugby
COMPANY PROFILE
Name: Kumulus Water
Started: 2021
Founders: Iheb Triki and Mohamed Ali Abid
Based: Tunisia
Sector: Water technology
Number of staff: 22
Investment raised: $4 million
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The biog
Place of birth: Kalba
Family: Mother of eight children and has 10 grandchildren
Favourite traditional dish: Al Harees, a slow cooked porridge-like dish made from boiled cracked or coarsely ground wheat mixed with meat or chicken
Favourite book: My early life by Sheikh Dr Sultan bin Muhammad Al Qasimi, the Ruler of Sharjah
Favourite quote: By Sheikh Zayed, the UAE's Founding Father, “Those who have no past will have no present or future.”
Monster
Directed by: Anthony Mandler
Starring: Kelvin Harrison Jr., John David Washington
3/5
Dubai Bling season three
Cast: Loujain Adada, Zeina Khoury, Farhana Bodi, Ebraheem Al Samadi, Mona Kattan, and couples Safa & Fahad Siddiqui and DJ Bliss & Danya Mohammed
Rating: 1/5
The specs
Engine: 3-litre twin-turbo V6
Power: 400hp
Torque: 475Nm
Transmission: 9-speed automatic
Price: From Dh215,900
On sale: Now
Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.
Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.
“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.
Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.
“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.
Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.
From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.
Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.
BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.
Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.
Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.
“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.
Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.
“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.
“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”
The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”
The specs
Engine: 2.4-litre 4-cylinder
Transmission: CVT auto
Power: 181bhp
Torque: 244Nm
Price: Dh122,900
COMPANY%20PROFILE
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MADAME%20WEB
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THE BIO
Ms Al Ameri likes the variety of her job, and the daily environmental challenges she is presented with.
Regular contact with wildlife is the most appealing part of her role at the Environment Agency Abu Dhabi.
She loves to explore new destinations and lives by her motto of being a voice in the world, and not an echo.
She is the youngest of three children, and has a brother and sister.
Her favourite book, Moby Dick by Herman Melville helped inspire her towards a career exploring the natural world.
Rankings
ATP: 1. Novak Djokovic (SRB) 10,955 pts; 2. Rafael Nadal (ESP) 8,320; 3. Alexander Zverev (GER) 6,475 ( 1); 5. Juan Martin Del Potro (ARG) 5,060 ( 1); 6. Kevin Anderson (RSA) 4,845 ( 1); 6. Roger Federer (SUI) 4,600 (-3); 7. Kei Nishikori (JPN) 4,110 ( 2); 8. Dominic Thiem (AUT) 3,960; 9. John Isner (USA) 3,155 ( 1); 10. Marin Cilic (CRO) 3,140 (-3)
WTA: 1. Naomi Osaka (JPN) 7,030 pts ( 3); 2. Petra Kvitova (CZE) 6,290 ( 4); 3. Simona Halep (ROM) 5,582 (-2); 4. Sloane Stephens (USA) 5,307 ( 1); 5. Karolina Pliskova (CZE) 5,100 ( 3); 6. Angelique Kerber (GER) 4,965 (-4); 7. Elina Svitolina (UKR) 4,940; 8. Kiki Bertens (NED) 4,430 ( 1); 9. Caroline Wozniacki (DEN) 3,566 (-6); 10. Aryna Sabalenka (BLR) 3,485 ( 1)
Cracks in the Wall
Ben White, Pluto Press
The specs: 2018 Jaguar E-Pace First Edition
Price, base / as tested: Dh186,480 / Dh252,735
Engine: 2.0-litre four-cylinder
Power: 246hp @ 5,500rpm
Torque: 365Nm @ 1,200rpm
Transmission: Nine-speed automatic
Fuel consumption, combined: 7.7L / 100km
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BlacKkKlansman
Director: Spike Lee
Starring: John David Washington; Adam Driver
Five stars
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Match info
Arsenal 0
Manchester City 2
Sterling (14'), Bernardo Silva (64')
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Company%C2%A0profile
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OPENING FIXTURES
Saturday September 12
Crystal Palace v Southampton
Fulham v Arsenal
Liverpool v Leeds United
Tottenham v Everton
West Brom v Leicester
West Ham v Newcastle
Monday September 14
Brighton v Chelsea
Sheffield United v Wolves
To be rescheduled
Burnley v Manchester United
Manchester City v Aston Villa
More from our Neighbourhood series:
ICC Intercontinental Cup
UAE squad Rohan Mustafa (captain), Chirag Suri, Shaiman Anwar, Rameez Shahzad, Mohammed Usman, Adnan Mufti, Saqlain Haider, Ahmed Raza, Mohammed Naveed, Imran Haider, Qadeer Ahmed, Mohammed Boota, Amir Hayat, Ashfaq Ahmed
Fixtures Nov 29-Dec 2
UAE v Afghanistan, Zayed Cricket Stadium, Abu Dhabi
Hong Kong v Papua New Guinea, Sharjah Cricket Stadium
Ireland v Scotland, Dubai International Stadium
Namibia v Netherlands, ICC Academy, Dubai
