Adnoc Drilling IPO price implies equity valuation of US$10bil

DUBAI: State oil giant Abu Dhabi National Oil Co (Adnoc) has set a price for the initial public offering (IPO) of its drilling unit, giving Adnoc Drilling an equity valuation of US$10bil (RM41.4bil), it said yesterday.

Adnoc will sell a minimum 7.5% stake in the IPO of Adnoc Drilling at 2.3 dirhams (0.62 US cents or RM2.61) per share, raising at least US$750mil (RM3.1bil) in the deal.

The sale is the second public flotation of a company owned by the Abu Dhabi oil major after the 2017 listing of Adnoc Distribution, the largest operator of petrol stations and convenience stores in the United Arab Emirates.

Adnoc will sell a minimum 1.2 billion shares in the IPO, according to the prospectus, but it reserved the right to increase the size of the offering at any time before the end of the subscription period.

The equity valuation is similar to that in 2018 when Adnoc sold a 5% stake in Adnoc Drilling to Baker Hughes.

The planned IPO is the latest move by Gulf oil giants Adnoc and Saudi Aramco to raise cash from outside investors as they try to diversify sources of income in their oil-dependent economies. Saudi Aramco listed in late 2019, raising US$29.4bil (RM122bil) in the world’s biggest IPO.The offer price was determined by Adnoc and Adnoc Drilling, following strong initial demand indications from both local and international investors, Adnoc said.

The subscription period opened on Sunday and will close on Sept 23 for UAE retail investors and on Sept 26 for qualified domestic and international institutional investors. — Reuters

Adnoc Drilling is expected to list on the Abu Dhabi Securities Exchange on or around Oct 3, it said. -- Reuters