ADNOC to Offer 15% Stake in Its Maritime Logistics Arm ‘ADNOC L&S’

ADNOC, the Abu Dhabi state-owned energy company, on Wednesday announced its plans to sell a 15% stake through an Initial Public Offering (IPO), in its maritime logistics arm – ADNOC Logistics and Services PLC – on the Abu Dhabi Securities Exchange (ADX).

This is the second listing of ADNOC, which has listed the shares of ADNOC Gas for trading on the ADX in mid-March this year. Through the ADNOC Gas listing, the company has raised $2.5 billion, said to be the world’s second-biggest IPO of the year at present. In all, ADNOC L&S will be the sixth company that ADNOC is bringing to market.

“As the sixth company ADNOC is bringing to market, ADNOC L&S is ideally placed to drive performance, deliver value, and capitalize on both ADNOC’s ambitious growth roadmap and the growing global demand for lower-carbon, reliable energy supplies,” said Khaled Al Zaabi, Group Chief Financial Officer, ADNOC.

ADNOC will offer about 1.11 billion shares of ADNOC Logistics & Services PLC, and the company will announce the price range and start taking investor orders on May 16, with final pricing slated for May 25. Shares in ADNOC Logistics are expected to begin trading June 1.

Notwithstanding a slump in global markets fearing recession and bank failures in the US, the GCC region, particularly Saudi Arabia and the UAE, which are the two economic power houses in the Arab world, have been active in the region’s IPO market largely due to spurt in oil prices in 2022.

ADNOC has been expanding its fleet to cope with increased demand from growth in the state-owned firm’s upstream and downstream businesses. It recently signed a five-year contract with ADNOC Offshore to provide integrated logistics services including port services and warehouse operations.

First Abu Dhabi Bank PJSC, Abu Dhabi Commercial Bank PJSC, EFG Hermes UAE LLC and HSBC Bank Middle East Ltd. are joint lead managers for the IPO.

According to the company, ADNOC Logistics & Services IPO represents a unique opportunity for individual subscribers, professional investors, ADNOC Group employees, and UAE national retirees to own shares in one of the largest fully integrated shipping and logistics service providers for the energy sector.

About ADNOC Logistics & Services

ADNOC Logistics & Services is a global energy maritime logistics leader and the dedicated and vital logistics arm for the ADNOC Group, providing critical and highly specialized services across ADNOC’s entire value chain.

The company is one of the largest end-to-end, fully integrated energy logistics service providers for the energy sector, providing critical services through three key business units: Integrated Logistics, Shipping, and Marine Services.

It provides market-leading, reliable, and cost-competitive maritime and integrated logistics solutions to ADNOC Group companies and to over 100 global clients in more than 50 countries.

As the logistics service provider of choice to the ADNOC Group, ADNOC Logistics & Services’ offshore energy logistics services are vital to enabling offshore production of oil in the UAE while the Company’s marine services help ensure uninterrupted operations of the petroleum ports in Abu Dhabi and safety of sea operations through oil spill response hazardous and noxious substances response operations.

The Company is also committed to sustainability across its operations, contributing to achieving the UAE’s 2050 net-zero target and ADNOC’s 2030 target of reducing emissions intensity by 25%. We are currently progressing on decarbonization ambitions by investing in a technologically advanced fleet with low fuel consumption.

Revenues in 2022

The revenues of ADNOC L&S were $2.28 billion in 2022 and the adjusted pro forma EBITDA was $599.3 million.

“Assuming a full calendar year contribution from the ZMI Holdings acquisition in 2022, ADNOC L&S’ revenue would have increased at a compound annual growth rate (CAGR) of more than 20%,” the company added.