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September 23, 2021

Adnoc raises drilling unit IPO size to $1.1bn amid strong demand

The firm has increased the number of ordinary shares offered from 1.2 billion to 1.76 billion at a share offer price of $0.6262.

By Archana Rani

Abu Dhabi National Oil (ADNOC) has increased the size of the ordinary shares offered in the initial public offering (IPO) of its drilling unit ADNOC Drilling to $1.1bn.

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Following approval from the UAE Securities and Commodities Authority (SCA), the decision to increase the issued share capital of the drilling unit to 11% from the previous target stake of 7.5% comes in the wake of oversubscription.

The firm said in a statement: “The new offering size was determined by ADNOC, as the selling shareholder, based on significant investor demand and the considerable oversubscription across all tranches.

“The enlarged offering will enable a broader investor base to obtain exposure to ADNOC Drilling’s highly attractive value proposition.

ADNOC said it has not changed the share price, each at $0.6262 (AED2.3), but increased the number of ordinary shares offered from 1.2 billion to 1.76 billion, which would correspond to a transaction worth $1.1bn.

Open to institutional and individual investors, the offering is ADNOC’s second public flotation after it listed ADNOC Distribution in 2017.

Post-IPO, ADNOC will retain a majority stake in the drilling unit, in which Baker Hughes owns 5% of the share capital.

The company previously said that the IPO is part of its plan to actively manage and optimise its assets portfolio while creating new investment opportunities across its business.

By the end of this decade, ADNOC Drilling aims to increase crude oil production capacity to five million barrels per year and unconventional gas capacity to one billion cubic feet per day.

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Free Report
img

What’s missing from your IPO industry assessment?

IPO activity all but stopped in 2020, as the investment community grew wary of the effects of COVID-19 on economies. No matter how deserving a business was of flotation, momentum was halted by concerns of when a ‘new normal’ of working patterns and trade would set in. Recently, sentiment has changed. Flotations picked up again during the second half of 2021, and now in 2022 the mood is decidedly optimistic. Business leaders have their eyes on fast rebounding economies, buoyant market indices and the opportunity once again to take their businesses public. As a result, global IPOs are expected to hit back this year. With GlobalData’s new whitepaper, ‘IPOs in Consumer and Retail: 5 must-include elements for your prospectus industry report’, you can explore exactly what is needed in the essential literature. GlobalData’s focus lies in the critical areas to get right:
  • Macroeconomic and demographic environment
  • Consumer context
  • Industry environment
  • Competitive environment
  • Route to market
Interested to learn more about what to include in your IPO Industry Assessment report? Download our free whitepaper.
by GlobalData
Enter your details here to receive your free Report.

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