The IPO is the largest ever in Abu Dhabi and the largest globally, year to date, as the city is expecting eight more listings
Shares in ADNOC Gas, the gas business of ADNOC Group, soared on its trading debut on the Abu Dhabi Securities Exchange (ADX) on Monday after the company raised $2.5bn in what is the world’s biggest flotation this year.
ADNOC Gas’ shares shot up by more than 18 per cent to trade at $0.76 (Dhs2.82) against its initial public offering (IPO) price of Dhs2.37, which was the top end of its offer price – valuing the company at Dhs216bn.
State-owned energy firm ADNOC, which initially planned to raise $2bn by offering a 4 per cent stake in ADNOC Gas increased the size of its offer to 5 per cent due to significant investor demand, drawing orders worth $124bn.
The state-owned energy giant said retail investors put in orders for $23bn, over 58 times the shares reserved for them, the highest-ever level of demand for retail tranches in a MENA IPO to date. Cornerstone investors including Abu Dhabi state-linked firms subscribed to $850mn worth of shares ahead of the final pricing announcement.
Upon listing, ADNOC will continue to own around 90 per cent majority stake in the unit while Abu Dhabi National Energy Company (TAQA) will retain its 5 per cent shareholding. ADNOC Gas is listed under the ticker symbol ‘ADNOCGAS’.
يفخر #سوق_أبوظبي_للأوراق_المالية بالترحيب بشركة #أدنوك_للغاز، أكبر طرح على الإطلاق في أبوظبي، وأكبر اكتتاب عام أولي على مستوى العالم خلال العام الجاري حتى الآن. #استثمر_في_أبوظبي #في_أبوظبي #الامارات #تداول #طاقة_للحياة pic.twitter.com/damZMiy5Jz
— سوق أبوظبي للأوراق المالية (@ADX_AE) March 13, 2023
ADNOC Gas has a production capacity of 10 billion cubic feet a day across eight onshore and offshore sites. The company was created following the merger of ADNOC’s gas processing and LNG operations in November 2022. It has a pipeline network of more than 3,250km and expects to pay dividends of $3.25bn for 2023.
First Abu Dhabi Bank and HSBC Holdings led the IPO while Abu Dhabi Commercial Bank, Arqaam Capital, BNP Paribas, Deutsche Bank, EFG-Hermes and International Securities were joint book runners.
ADX market cap surges
Meanwhile, ADX’s market capitalisation is set to surge to Dhs2.9 trillion after ADNOC Gas’s debut trading, according to WAM.
ADX’s market cap will rise above Dhs2.7tn for the first time in the bourse’s history as the market keeps luring more IPOs in an effort to further strengthen the UAE’s financial standing on a regional and international scale.
IPO frenzy
ADNOC Gas’ IPO is also the latest in a string of listings that ADX has attracted this year as the stock market has introduced an array of initiatives to revive primary issues in Abu Dhabi.
The move is part of the UAE government’s broader strategy to diversify the economy and bring more international investors into its markets. In other news, Presight AI Holding, a data analytics firm owned by Abu Dhabi’s G42 Group, announced that it has started taking investor orders for its upcoming IPO in Abu Dhabi at a fixed price of Dhs1.34 apiece.
G42 is offering 1.35 billion shares, equivalent to 24.24 per cent of the company’s paid-up capital and the indicative price implies a market valuation of as much as Dhs7.51bn.
At least eight companies are expected to list in Abu Dhabi this year after ADNOC Gas’s record public offering, the city’s largest IPO after Borouge’s $2bn deal in mid-2022.
In other news, Dubai-based exchange house Al Ansari Financial Services also announced plans to divest 10 per cent of the company on the Dubai Financial Market (DFM) via an IPO.
The company is offering 750 million shares in the listing and it will start taking orders from retail investors from March 16 to March 23, and institutional investors until March 24.
Al Ansari’s listing is the first on the DFM this year after the city recorded the largest offerings in the Middle East in 2022 following the listing of utility firm DEWA, business park operator TECOM and road-toll operator Salik.
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