ADNOC plans to implement a syndicated offering of "ADNOC Distribution" shares worth 6 billion dirhams
Abu Dhabi National Oil Company "ADNOC", the owner of 80% of the ordinary shares of the Abu Dhabi National Oil Company for Distribution "ADNOC Distribution" - International Securities Identification Number: "AEA006101017" today announced its intention to offer about 375 million shares of ADNOC Distribution listed and traded on Abu Dhabi Securities Exchange under the symbol: "ADNOCDIST", which represents approximately 3% of the registered capital of "ADNOC Distribution", through the mechanism of the rapid offer of shares at a price of 4.36 dirhams per share. The offering will be for a specific group of qualified investment institutions in accordance with the rule of "144A." And Regulation “S” of the US Securities Act of 1933, as amended, “The US Securities Act”.
In conjunction with the stock offering, ADNOC intends to issue approximately 4.385 billion dirhams of "unsecured" bonds due for payment in 2024, through an offering process to qualified investors outside the United States in accordance with Regulation S of the US Securities Law.
These bonds will be exchangeable with actual shares in ADNOC Distribution, which represents approximately 7% of the company’s registered capital in accordance with specific conditions “Exchangeable Bonds”.
The pooled offering will not be available to the public in the UAE or any other jurisdiction.
This combined offering represents approximately 10% of the registered capital of ADNOC Distribution, in the event that the shares of all the exchangeable bonds are exchanged and settled according to their specified terms.
The final selling price of the consolidated offering of AED 4.82 represents a 5% increase over the average share price of ADNOC Distribution for the past three months.
The redemption bond offering has a maturity period of 3 years and will be issued at a 100% issue rate with coupons at "70%" annually, to be paid on a semi-annual basis in the form of arrears in June and December of each year.
The share price exchange premium will be determined at "15%" on the reference price for "ADNOC Distribution" shares, so that the replacement price will be AED 5.01.
This deal is the first combined offering of shares and exchangeable bonds in the Arab Gulf region, reflecting ADNOC's continuing strategy to enhance the value of its assets.
The innovative transaction structure allows ADNOC to attract a broad and diverse base of new investors, including those interested in investing in equity-linked bonds.
The terms of the exchangeable bonds also provide more opportunities to liquidate ADNOC Distribution shares at a premium to the share offering price.
The sale of a stake in ADNOC Distribution shares in line with ADNOC's commitment to promote the free circulation of ADNOC Distribution Company shares after the successful initial public offering in December 2017. On May 11, 2021, Morgan Stanley Capital International announced the listing of ADNOC Distribution within MSCI Index as of May 27, 2021, to be one of nine Emirati companies included in this index. This step is expected to contribute to diversifying the investor base and defining the unique investment value provided by the company.
It is expected that the final terms of the consolidated offering process will be announced after the completion of the purchase requisition registration process.
The settlement of the share offering is expected to take place on “or around” May 31, 2021, and the replaceable bonds will be settled on “or around” June 4, 2021. ADNOC has agreed to a 90-day closing period from the settlement date in accordance with the terms of the offering of shares and exchangeable bonds. .
An application is also expected to be submitted to list the exchangeable bonds on the Vienna MTF Stock Exchange, which is a regulated stock exchange under the management of the Vienna Stock Exchange.
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