Abu Dhabi National Oil Company plans to sell a roughly 5.5% stake in its drilling unit, more than two years after it raised $1.1 billion from an initial public offering of part of the business, it said on Wednesday.
Additional shares in the unit will be offered to eligible institutional investors, the company said.
ADNOC Drilling’s shares closed at 4.13 dirhams ($1.12) on Wednesday. At that valuation, the 5.5% stake being offered would be worth $989.6 million.
The bookbuilding for the offering of about 880 million shares will begin “immediately” and end on May 23 or earlier, after which the offer price and final number of shares sold will be determined, ADNOC said in a statement.
Increasing ADNOC Drilling’s free float is expected to lead to the company’s inclusion in the Morgan Stanley Capital International (MSCI) Emerging Market Index, ADNOC said. That could happen at the next quarterly index review subject to ADNOC Drilling meeting criteria, it added.
After selling an 11% stake in October 2021, ADNOC currently owns 84% of ADNOC Drilling, while Baker Hughes owns a further 5%.
The IPO was priced at 2.3 dirhams a share, and the stock soared about 30% on its debut.
The new sale “supports ADNOC’s commitment to further strengthen the Abu Dhabi equity capital market while creating sustainable value for shareholders across its listed portfolio”, the state oil giant said.
Egyptian investment bank EFG Hermes, First Abu Dhabi Bank, Goldman Sachs and JPMorgan Securities are joint global coordinators and bookrunners for the offering.
Source: Reuters.com