Abu Dhabi’s national oil company is weighing proposals from Goldman Sachs, First Abu Dhabi Bank, HSBC and JPMorgan for lead roles in the listing of its retail business as the emirate joins other Gulf states in privatising assets, sources familiar with the matter said.
Rothschild is separately in a strong position for an advisory role in a deal that could raise $1.5 to $2bn, sources told Reuters.
The listing of Abu Dhabi National Oil Co’s (ADNOC) Distribution business, which manages 300 petrol stations as well as convenience stores across the United Arab Emirates (UAE), is planned before the end of the year, one of the sources told Reuters.
The listing of the retail unit in Abu Dhabi is aimed at boosting the valuation of the company in an era of cheap oil prices, they said.
ADNOC’s listing could also stir the UAE’s lacklustre IPO scene from its recent slumber. There have been only two IPOs so far in 2017 in the UAE, raising $348.5m, and none at all last year, Thomson Reuters data shows.
Plans to list some of ADNOC’s services businesses come as other Gulf states, such as Saudi Arabia and Oman, have also embarked on floating energy assets.
Beyond the Gulf region, oil companies are looking to raise capital from listings or sales of retail units. China Petroleum and Chemical Corp is planning to list its retail unit in Hong Kong as early as the end of this year in a multi-billion dollar deal, while Thailand’s biggest energy company PTT is examining a proposal to list its retail business.
The pitching process for the ADNOC deal is under way after the unlisted group announced this week that it is looking to float some of its services businesses and enter tie-ups with global investors to help it create new revenue streams and secure more market access.
Ten banks have been invited to pitch for a role in the IPO,one of the sources said.
ADNOC declined to confirm details of the pitching process, but a spokesman told Reuters “central to ADNOC’s new approach is the more active management of its portfolio of assets and businesses.”
“ADNOC is therefore considering the IPO of minority stakes of some of its services businesses and we will update the market on its plans in due course,” the spokesman said.
The banks either declined to comment or did not immediately respond to Reuters queries for comments.
ADNOC has no plans to list the holding company. State-owned ADNOC produces around three million barrels of oil per day and manages 95 percent of UAE’s proven oil reserves and 92 percent of the country’s gas reserves.