ADNOC Gas Delivers Record $2.84 Billion Placement

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ADNOC Gas Delivers Record $2.84 Billion Placement

Abu Dhabi National Oil Co. PJSC (ADNOC) achieved Friday what it said is the biggest placement on the Abu Dhabi exchange, raising about $2.84 billion from issuing 3.1 billion shares in its integrated gas processing arm to institutional investors. The so-called marketed offering, the first in the United Arab Emirates according to ADNOC, was priced […]

The so-called marketed offering, the first in the United Arab Emirates according to ADNOC, was priced at AED 3.4 ($0.93) per share, about 43 percent higher than ADNOC Gas PLC’s initial public offering (IPO) price of AED 2.37 in March 2023. Raising around $2.5 billion and resulting in a market capitalization of approximately $50 billion, the IPO was the largest on the Abu Dhabi bourse then according to ADNOC.

Friday’s offering, which attracted Gulf and international investors, represents four percent of ADNOC Gas’ issued and outstanding share capital and will raise its free float to 9 percent headline, ADNOC said in an online statement. ADNOC retains an 86 percent stake in ADNOC Gas.

“A higher free float is also expected to provide a pathway towards inclusion in the Morgan Stanley Capital International Emerging Market Index and the Financial Times Stock Exchange Emerging Market Index, which may take place at the next quarterly review, subject to ADNOC Gas meeting all the relevant inclusion criteria”, ADNOC said. “Index inclusion of ADNOC Gas would contribute to the diversification of the Company’s investor base and significantly broaden awareness of its value proposition”.

The offering was oversubscribed 4.4 times, ADNOC said, noting the final offer price represented a five percent discount to ADNOC Gas’ closing price Thursday.

ADNOC expects settlement February 26. BofA Securities, Citi, EFG-Hermes, First Abu Dhabi Bank, HSBC and International Securities acted as joint global coordinators and joint bookrunners.

ADNOC chief financial officer Khaled Al Zaabi said, “The exceptional demand and competitive discount provided by the international and domestic investor community reflects the strong confidence in ADNOC Gas’ track record and growth prospects”.

In 2024 ADNOC Gas achieved its highest-ever yearly net profit at $5 billion, driven by natural gas demand in the UAE.

Net income for the fourth quarter of 2024 totaled $1.38 billion, ADNOC Gas’ highest quarterly result since its public listing in 2023, it reported February 6, 2025.

Annual sales volumes grew two percent to 3,616 million MMBtu. ADNOC Gas supplies about 60 percent of the UAE’s sales gas needs, as well as supplies over twenty countries, according to the company.

Adjusted revenue for 2024 rose seven percent year-on-year to $24.43 billion. “The company’s strong top-line performance for 2024 translated into a strong EBITDA [earnings before interest, taxes, depreciation and amortization) growth of 14 percent to $8.65 billion with a high, stable margin of 35 percent”, ADNOC Gas said.

For the fourth quarter, adjusted revenue was $6.06 billion and EBITDA $2.28 billion. “The robust improvement was driven by several factors including a richer mix of gas, producing more liquids, and improved commercial terms in the domestic market”, ADNOC Gas said.

Year-end free cash flow was $4.58 billion, with the October-December period contributing $1.22 billion.

ADNOC Gas declared a dividend of $3.41 billion for 2024, half of which was paid September 2024. It expects to distribute the remaining half this April.

“The final dividend for FY 2024 is in line with the company’s robust policy to increase the annual dividend by 5 percent annually and reflects the company’s strong free cash flow, which exceeds the dividend commitment by over $1 billion”, it said.

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