Offer price for Abu Dhabi’s largest ever listing set at Dhs2.45 per share

Abu Dhabi National Oil Company (ADNOC) and Borealis have announced the offer price for the initial public offering (IPO) of Borouge, their petrochemicals joint venture.

The price per share for the offering to be listed on the Abu Dhabi Securities Exchange (ADX), has been set at Dhs2.45, implying an equity value of $20bn. This makes the Borouge IPO the largest-ever listing to date in Abu Dhabi’s history, official news agency WAM reported.

Today we announced the offer price for the @Borouge IPO at AED 2.45 per share.

Find out how to invest: https://t.co/b9Xmhzz5G5 pic.twitter.com/7sNbdmCXFI

— ADNOC Group (@AdnocGroup) May 23, 2022

The offer price was determined by ADNOC and Borealis (selling shareholders) following investor engagement that saw strong initial demand indications from both local and international investors.

On May 22, 2022, the selling shareholders and Borouge entered into cornerstone investment agreements with entities controlled by International Holding Company, Multiply Group, and Alpha Dhabi Holding, who have committed to subscribe for shares in the offering valued at $50m; $50m; and $100m respectively, a regulatory announcement on Borouge’s website revealed.

Alpha Dhabi Holding has made a AED 367 million investment into Borouge’s initial public offering (IPO).

This investment supports our investment criteria from both a company profile and sector perspective.#alphadhabi #adh #abudhabi pic.twitter.com/c8HLFVwxnc

— Alpha Dhabi Holding (@adh_uae) May 23, 2022

Furthermore, ADQ has committed $120m; Abu Dhabi Pension Fund has committed $100m; Emirates Investment Authority has committed $75m; and the Adani Family has committed $75m, in each case, directly or indirectly, as subscription amounts for shares in the offering. All of the investors have committed to purchases shares at the offer price, subject to a minimum six-month lock-up period.

The IPO subscription period has commenced today, May 23 and will close to retail investors on May 28, 2022, and to institutional investors on May 30, 2022. The expected date of listing on the ADX is June 3, 2022.

Subscriptions are now open until 28 May for the UAE Public Offering of @Borouge – the strategic partnership between #ADNOC and @BorealisGroup.

Find out how to invest: https://t.co/b9Xmhzz5G5 pic.twitter.com/Wux1oRSaS6

— ADNOC Group (@AdnocGroup) May 23, 2022

Read: ADNOC begins process to list Borouge on Abu Dhabi Securities Exchange

Borouge reported full-year revenue of $5.5bn in 2021 and profit for the year of $1.5bn for its ADP business only. For 2022, the company expects to pay $975m in dividends to shareholders and follow that up with no less than $1.3bn for the full-year period in 2023, equivalent to a dividend yield of 6.5 per cent based on the price per share announced for the offering.

Borouge, established in 1998, has two ventures ADP, its operations joint venture headquartered in Abu Dhabi and PTE, its sales and marketing joint venture headquartered in Singapore. Borouge, through ADP and PTE, employs over 3,100 people and caters to customers in more than 50 countries across Asia, the Middle East and Africa.

Borouge is a provider of polyolefin solutions for the agriculture, infrastructure, energy, advanced packaging, mobility and healthcare industries. The Borouge portfolio of products comprises polyethylene and polypropylene, which have applications in sustainable packaging, pipes and fittings, wires and cables, automotive and medical products.

Borouge’s polymer solutions are categorised into two main product segments: consumer solutions and infrastructure solutions. Consumer solutions include sustainable packaging, medical containers and greenhouse films, while infrastructure solutions include water and gas pipes and cables for power transmission.

Earlier this month, ADNOC said that it would acquire a 25 per cent shareholding in Borealis from Mubadala. When the transaction is complete, Borealis will be owned 25 per cent by ADNOC and 75 per cent by OMV, an Austrian multi-national integrated oil, gas and petrochemical company listed on the Vienna Stock Exchange.

Read: Abu Dhabi National Oil Company to acquire 25% stake in Borealis

In February, Borouge announced the start up of its new fifth polypropylene unit (PP5) in Ruwais. The new facility was aimed at increasing Borouge’s polypropylene production capacity by more than 25 per cent to 2.24 million tonnes per year.

Read: Borouge starts up fifth polypropylene unit in Ruwais