UAE’s ADNOC raises size of its drilling unit IPO to 11%

UAE state-owned oil company Abu Dhabi National Oil Company (ADNOC) has increased the number of ordinary shares offered in the initial public offering (IPO) of ADNOC Drilling Company.

According to the statement, the offering will be increased from 1,200,000,000 ordinary shares to 1,760,000,000 ordinary shares, representing 11 percent of ADNOC Drilling’s entire issued share capital. This follows the permission from the UAE Securities and Commodities Authority.

Subject to completion of the IPO, ADNOC will retain a majority 84 percent ownership in the company, while Baker Hughes, which entered into a strategic relationship with ADNOC Drilling in 2018, will maintain its 5 percent share. The offer price of $0.63 (Dhs2.30) per share remains unchanged.

ADNOC plans to raise the size of the tranches reserved for UAE retail investors, including eligible ADNOC Group employees and UAE national retirees, as part of the revised offering size. “The final Tranche sizes will be determined at ADNOC’s discretion and announced on 27th September 2021,” as per the reports.

The new offering size was determined by ADNOC, as the selling shareholder, based on investor demand and the considerable oversubscription across all tranches. The expanded offering will allow a broader investor base to obtain exposure to ADNOC Drilling’s highly attractive value proposition.

According to the reports, “The subscription period for the ADNOC Drilling IPO remains unchanged and will close on September 23, 2021, for UAE retail investors and on September 26, 2021, for qualified domestic and international institutional investors.” ADNOC Drilling is expected to list on the Abu Dhabi Securities Exchange (ADX) on or around 3rd October 2021.

Earlier this month, ADNOC announced its intention to float 7.5 percent of its shares on ADX for trading as part of its goal to monetize assets and spend on expansion initiatives.

Related: ADNOC drilling proposes IPO of $10bn equity valuation