Abu Dhabi National Oil Company (ADNOC) and its Austrian chemicals partner Borealis plan an initial public offering of their petrochemicals joint venture Borouge, the latest step in the Abu Dhabi state energy group’s asset monetization program.
Borouge, which is a specialty plastics firm that produces polyolefin, said on Wednesday it planned to list its shares on the Abu Dhabi Securities Exchange (ADX).
Founded in 1998, Borouge could be worth $20 billion, which means an IPO size of $2 billion, two sources familiar with the deal told Reuters.
The company said its offering will consist of approximately three billion existing shares, representing 10% of the company’s issued share capital.
The offer, subject to regulatory approvals and other relevant considerations, will begin on May 23 and run to May 28 for retail investors and May 30 for institutional buyers, the company said in an intention to float (ITF) document.
It expects its shares to be admitted for trading on the ADX on June 3.
The Borouge portfolio of products comprises polyethylene and polypropylene, the two most common types of polymers, which are used for various applications such as sustainable packaging, pipes and fittings, wires and cables, automotive, and medical applications.
“ADNOC continues to consistently unlock and maximize value across its integrated upstream and downstream asset base to drive sustainable growth for the benefit of Abu Dhabi and the UAE,” said Sultan bin Ahmed al-Jaber, ADNOC’s managing director and Group CEO.
The offering will be open to all citizens and residents of the UAE and international and local institutional investors.
“Through Borouge and our recently announced 25% equity investment in Borealis, ADNOC is poised to capitalize on the significant industrial and consumer-led growth in the petrochemicals sector over the coming decades,” Jaber explained.
He pointed out that the proposed listing, the fourth subsidiary to come to market, is another significant milestone in ADNOC’S highly successful value creation and strategic growth journey.
Over the past six years, ADNOC has actively managed its businesses and capital, as well as successfully developed a more open, flexible, and innovative partnership model across its integrated upstream and downstream value chain.
This value creation and growth strategy is enabled by a $122 billion (AED447.7 billion) capital investment program across the Group between 2021 to 2025.
ADNOC is broadening its investor base and access to capital by listing minority stakes in select operating businesses, while also supporting the continued growth and expansion of the UAE’s private sector and capital markets.
This was initiated with the successful IPO of ADNOC Distribution in 2017 and followed by the largest and third largest-ever ADX listings to date with ADNOC Drilling and Fertiglobe respectively in October 2021.