Abu Dhabi’s ADQ lists debut $2.5bn bond on London Stock Exchange

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Abu Dhabi-based investment and holding company, ADQ has debuted its inaugural $2.5bn bond on the London Stock Exchange.

This move marks an important step in diversifying ADQ’s funding sources and supporting its strategic growth agenda.

Leveraging favourable market conditions and investor appetite for high-quality, investment-grade bonds from emerging market issuers, ADQ’s bond issuance garnered significant interest.

The combined order book peaked at over $11bn, reflecting an oversubscription of more than 4.4 times.

At pricing, the annual coupon rates for the five-year and ten-year tranches were fixed at 5.498 per cent and 5.5565 per cent per annum, respectively.

The issuance achieved broad institutional distribution, attracting major investors across Asia, the US, the Middle East, UK, and Europe.

This diverse investor base highlights the global appeal of ADQ’s investment strategy and the attractiveness of Abu Dhabi’s capital markets.

Fuelling growth and initiatives

The proceeds from the bond offering will serve as growth capital, enabling ADQ to further invest in strategic initiatives that contribute to the realisation of its mandate and expansion in key sectors.

Mohamed Hassan Alsuwaidi, MD and CEO of ADQ, emphasised the significance of investor confidence in Abu Dhabi’s capital markets and ADQ’s compelling growth prospects.“The significant market response to our inaugural bond issuance validates the strength of ADQ‘s credit profile, which benefits from the stability and resilience of the wider Abu Dhabi economy.

“Furthermore, it is reflective of investor confidence in Abu Dhabi’s capital markets and ADQ‘s compelling growth prospects.”

As of December 31, 2023, the company’s total assets amounted to Dhs196bn, with shareholdings in more than 25 portfolio companies spanning critical infrastructure assets in utilities, transportation, healthcare, agriculture, and real estate.

With a stable outlook, the firm is rated Aa2 by Moody’s and AA by Fitch, further affirming its strong credit profile and financial stability.

Strong financial fundamentals

ADQ’s chief financial officer, Marcos de Quadros, highlighted the success of the issuance under the newly established Global Medium Term Note Programme. He said: “Achieving an oversubscription of more than 4.4 times, the issuance demonstrates the commercial attractiveness of our business, which effectively balances nonfinancial impact with robust financial returns.

“Going forward, the programme will enable us to utilise debt capital markets as an effective option to fund our long-term investments and continue to support Abu Dhabi’s sustainable economic development.”

As of December 31, 2023, ADQ’s total assets amounted to Dhs196bn, with shareholdings in more than 25 portfolio companies spanning critical infrastructure assets in utilities, transportation, healthcare, agriculture, and real estate.

ADQ in the news

The holding company recently announced its acquisition of a 49 per cent stake in the Plenary Group.

The entities have formed a strategic partnership focused on accelerating the development and expansion of public and social infrastructure globally.

Read: Abu Dhabi’s ADQ acquires key stake in Australia’s Plenary Group

In other news, the holding firm also launched the $180m technology-focused Jasoor Fund, in collaboration with the Oman Investment Authority (OIA) represented by ITHCA Group.

This initiative is part of a broader framework agreement signed between the two entities in 2022.

The fund’s primary objective is to boost the digital economy in Oman and the wider MENA region by supporting high-growth technology companies.

Also read: UAE, Oman firms sign multi-sectoral deals worth Dhs129bn