October 13, 2021 | oil and gas

Fertiglobe IPO may raise as much as $827m

The company has priced its shares in a range between Dh2.45 and Dh2.65, implying an equity valuation of $5.5 billion to $6bn

The second tranche, which is open to qualified institutional investors will close on October 19.

'This IPO represents a milestone moment for Adnoc and Fertiglobe, as well as for the growing depth and development of the UAE’s equity capital markets,' said Dr Sultan Ahmed Al Jaber, UAE Minister of Industry and Advanced Technology, Adnoc managing director and group chief executive, and Fertiglobe chairman.

'Fertiglobe is ideally positioned to play a leading role in a critical global industry while accessing new opportunities in the rapidly emerging hydrogen economy,' he added.

The company has also attracted three cornerstone investors including the Abu Dhabi Pension Fund, Singapore's sovereign wealth fund GIC as well as San Francisco-based activist investor Inclusive Capital Partners.

Fertiglobe also plans to increase its dividend to $200m from $159m, with the payout due in April 2022.

Adnoc holds a 42 per cent stake in Fertiglobe, with OCI retaining the majority 58 per cent interest. OCI is listed on the Euronext Amsterdam exchange and has Egyptian billionaire Nassef Sawiris as its biggest shareholder. Fertiglobe was formed in 2019 following the merger of Adnoc’s fertiliser arm and OCI’s Middle East nitrogen fertiliser business. Fertiglobe's headquarters is at the Abu Dhabi Global Market.

OCI is expected to indirectly continue to own a majority of Fertiglobe’s share capital post-IPO, while Adnoc is expected to indirectly own at least 36.2 per cent of Fertiglobe’s share capital following the offering.

Fertiglobe’s ADX listing will be the first of a free zone company onshore in the UAE. It strategically positions the company to capitalise on new demand for low-carbon ammonia. The chemical is an integral part of the clean hydrogen economy, in which blue and green ammonia serve as an efficient energy carrier and as a clean fuel. The listing will also allow the company to leverage strengths and global reach from both shareholders.

Fertglobe, the joint venture between Abu Dhabi National Oil Company and Dutch fertiliser company OCI may raise as much as $827 million in an initial public offering after the company priced its shares on Wednesday.

The company is selling more than 1.145 billion shares representing 13.8 per cent of the company’s share capital. The shares have a price range between Dh2.45 and Dh2.65, implying an equity valuation of $5.5 billion to $6bn. Based on the minimum price range the company would raise at least $765m from the listing.

The company is the world’s largest seaborne exporter of urea and ammonia and is the region's largest producer of nitrogen fertilizers by production capacity.

The subscription period for the initial public offering commences today and will close on October 18 for individual and other investors in the UAE.


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