It is likely that the fuel retailer business will be listed on the Abu Dhabi stock exchange and could happen early next year.
As part of a major restructuring, Abu Dhabi National Oil Co (ADNOC) could list more than 10 percent of its fuel retail business by early 2018, and one or two more businesses later on.
If the IPO of ADNOC Distribution proves successful, ADNOC could in future choose to float one or maximum two more businesses such as its drilling arm, National Drilling Company, or energy infrastructure.
ADNOC would be made a more competitive and commercially-focused firm, more similar to other state-owned controlled peers, with the partial privatization move.
An ADNOC spokesman said: "As announced on July 10, ADNOC is expanding its partnership model and creating new investment opportunities across all areas of its value chain. Central to ADNOC`s new approach will be the more active management of its portfolio of assets and businesses. ADNOC is therefore considering the potential IPO of minority stakes of some of its services businesses which have attractive investment and growth profiles."
A major shake – up has been initiated ever since the appointment of Sultan al-Jaber as ADNOC`s chief executive last year.
The fuel industry has been forced to cut costs and look for ways to boost efficiency, in the aftermath of sharp drop in crude prices since mid-2014.
Robin Mills, chief executive of UAE-based consultancy Qamar Energy said, "With prices not expected to increase much and production constrained by OPEC, Abu Dhabi needs to find alternative ways to get value out of its NOC (national oil company)." Source: Reuters PWKD12092017
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