ADNOC Raises USD 1.64 Billion Through Issuance of Exchangeable Bonds

Abu Dhabi National Oil Company (“ADNOC”), announced today the successful closing of its offering of approximately 375 million shares in ADNOC Distribution (the “Share Offering”), representing approximately 3% of the registered share capital of ADNOC Distribution. It also issued approximately USD 1.195 billion of senior unsecured bonds (the “Exchangeable Bonds”) due 2024 that are exchangeable into existing shares of ADNOC Distribution constituting approximately 7% of the registered share capital of ADNOC Distribution (ISIN: AEA006101017) (ADX Symbol: ADNOCDIST) under certain conditions (the “Exchangeable Bond Offering” and, together with the Share Offering, the “Combined Offering”). In total, the Combined Offering resulted in proceeds of USD 1.64 billion for ADNOC.

Following a successful bookbuilding process, the Combined Offering was placed at a blended price of AED 4.82 per share, which is 5.7% above the current 3-month volume weighted average share price and less than 1% below today’s closing price of AED 4.85. The Combined Offering was covered in less than one hour, and saw significant demand from regional and international investors.

The Exchangeable Bonds, with a maturity date of 2024 (except in the case of early redemption), are denominated in US Dollars (USD) and bear a coupon of 0.70%. The Exchangeable Bonds are issued at an issue price of 100% and will be exchangeable into existing shares of ADNOC Distribution at an exchange price of AED 5.01 (USD 1.37) under certain conditions.

The innovative deal structure has the potential to increase the free float of ADNOC Distribution to 30% assuming the Exchangeable Bonds are exchanged and settled in shares, bringing greater liquidity to ADNOC Distribution shares and diversifying the shareholder base, while the blended price of the Share Offering and the Exchangeable Bond Offering improves the overall value of the sell down to ADNOC Group, and the UAE. Following the transaction, ADNOC will retain at least a 70% strategic stake in the company as it continues to see significant growth potential in ADNOC Distribution.

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