ADNOC L&S issues $2bn hybrid capital facility to fund growth

UAE’s ADNOC Logistics & Services (ADNOC L&S) has issued a $1.1-2.0bn (Dhs4.0-7.3bn) hybrid capital instrument to fund growth, including the acquisition of Navig8 and finance value-accretive investments.

“Approximately $1bn of the hybrid capital instrument will be utilised to fund the acquisition of Navig8. The remainder is available to fund announced or new value-accretive investments,” ADNOC L&S said in a bourse filing.

The Abu Dhabi-listed energy logistics firm said that the initial drawing against the facility will be $1.1bn, leaving $0.9bn capacity available to be drawn until December 31, 2026.

“The combination of existing cash, the new finance facility, and the cash flow from our contracted vessels ensures that we are adequately funded to capitalise on value-accretive growth opportunities in line with our strategy of building a leading energy maritime and logistics company,” said Abdulkareem Al Masabi, the CEO of ADNOC L&S.

The first drawdown against the facility bears an all-in pricing below SOFR (Secured Overnight Financing Rate) +150 basis points and is repayable at the company’s discretion.

Since its initial public offering in June 2023, ADNOC L&S has committed to investing more than $5 bn in energy-related maritime logistics. The company has set a target leverage of 2.0 – 2.5x net debt-to-EBITDA.

Societe Generale arranged and led the financing facility, with participation from Abu Dhabi Commercial Bank, First Abu Dhabi Bank, Crédit Agricole Corporate and Investment Bank, BBVA, and DBS Bank.

Meanwhile, ADNOC L&S has completed the acquisition of an 80 per cent stake in maritime logistics firm Navig8 TopCo Holdings in a deal valued at $1.04bn, with a contractual commitment to acquire the remaining 20 per cent in mid-2027.

The acquisitions will give ADNOC L&S access to Navig8’s fleet of 32 tankers and global footprint in 15 cities across five continents. The deal will also expand the energy logistics firm’s service portfolio by adding commercial pooling and bunkering services, internationalising commercial reach and technical management and extending ESG-focused industrial and digital solutions.

Read: ADNOC L&S awards $4.4bn contracts to build 23 supertankers