ADQ, an Abu Dhabi-based investment and holding company, has submitted an offer to Abu Dhabi Aviation (ADA) to combine its full 100 percent shareholding of Etihad Engineering and AMMROC, as well as its 50 percent ownership of GAL, into ADA.
The proposed combination is to establish a diversified aviation service and MRO business, with strategic market access and commercial relationships with the world’s largest global aircraft manufacturers and original equipment manufacturers (OEMs).
The transaction is expected to create a globally competitive aviation business headquartered in Abu Dhabi to position the Emirate as a world-leading hub for aviation MRO services, logistics, supply chain and advanced engineering capabilities. The combined group would have assets of approximately $2.6 billion with an extensive portfolio of aircraft, MRO centers and hangars.
“The proposed transaction will further position Abu Dhabi as a world-leading center of aviation excellence, combining the strengths of each asset to form a global MRO and aviation services champion to capitalize on growth opportunities in the aviation industry. The proposed combination will provide a framework for investing in the future development of an advanced aviation ecosystem that supports the sustainable transformation of Abu Dhabi and the UAE’s economy for the long term.”
Upon closing of the transaction, ADA will issue to ADQ a convertible instrument that would convert into approximately 652 million ordinary shares in the capital of ADA. The price at which the convertible instrument will convert into shares in ADA is $1.67 per share. The offer implies an equity valuation of approximately $735 million for ADA. Following completion, ADQ would own approximately 59 percent of the entire issued share capital of ADA.
Related: Abu Dhabi’s ADQ enters into deal to monetize minority stake in TAQA