The UAE’s Abu Dhabi National Oil Company (ADNOC) has carried out placement to institutional investors of 10 percent to 1.25 billion shares in its subsidiary ADNOC Distribution, media reports said. The shares are valued at $1 billion.
The development comes at a time when global oil companies are still scrambling for profits.
The price of the placement was valued at DH 2.9 per share, which is a good price representing a percent rebate on the company’s 3-month volume weighted average price.
Dr Sultan Ahmed Al Jaber, ADNOC Group CEO, told the media, “This transaction highlights the attractive nature of ADNOC Distribution to investors, and once again demonstrates the high-quality investment opportunities offered by ADNOC and more broadly by Abu Dhabi and the United Arab Emirates. For the investors, it presented a unique opportunity to access a sizeable stake in ADNOC Distribution and invest in a stable and highly compelling equity story, with an attractive and resilient dividend policy. It also contributes to increased liquidity in the trading of shares in ADNOC Distribution, while broadening the shareholder base.”
It is reported that the placement will boost ADNOC Distribution’s free float to 20 percent, while the parent company will have an 80 percent strategic stake in ADNOC Distribution and continue to assist the latter. The placement will also improve the liquidity of ADNOC Distribution.
ADNOC expressed its interest in selling more of its shareholding in ADNOC Distribution At the time of ADNOC Distribution’s initial public offering in 2017.