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Fri, Nov 22, 2024 | Jumada al-Awwal 20, 1446 | DXB
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Adnoc Distribution to acquire a 50% stake in TotalEnergies’ business in Egypt
Abu Dhabi-listed company signs an agreement to acquire a stake in a significant portfolio, which includes 240 fuel retail stations, wholesale fuel, aviation fuel and lubricants operations
Under the deal, Adnoc Distribution and TotalEnergies will develop future growth opportunities of TotalEnergies Egypt through unlocking value potential and exploring beneficial synergies in fuel distribution, lubricants and aviation businesses driven by economic growth and post Covid recovery. — Supplied photo
Adnoc Distribution has signed an agreement with TotalEnergies Marketing Afrique to acquire a 50 per cent stake in TotalEnergies Marketing Egypt (TotalEnergies Egypt) for approximately $186 million, with an additional earn-out of up to $17.3 million.
In a statement, the UAE’s largest fuel and retail distributor said the acquisition will also see the refurbishment of several service stations to full Adnoc branding, with certain future sites being constructed under the Adnoc brand, offering a robust foothold in a fast-growing fuel retail market in Egypt.
Growth opportunities
Under the deal, Adnoc Distribution and TotalEnergies will develop future growth opportunities of TotalEnergies Egypt through unlocking value potential and exploring beneficial synergies in fuel distribution, lubricants and aviation businesses driven by economic growth and post Covid recovery.
The acquisition is expected to be completed in first quarter of 2023 pending satisfaction of certain conditions, including customary regulatory approvals.
Dr Sultan Ahmed Al Jaber, Minister of Industry and Advanced Technology, managing director and Group CEO of Adnoc, and Chairman of Adnoc Distribution said this acquisition marks a significant milestone in Adnoc Distribution’s international growth story.
“Egypt is the Arab world’s most populous country and we look forward to entering such a dynamic market. The acquisition is also well aligned with the Industrial Partnership for Sustainable Economic Growth between the UAE, Bahrain, Egypt, and Jordan and will leverage the strengths of both the UAE and Egypt to boost growth in the related markets,” Al Jaber said.
Adnoc Distribution’s expansion
Established in 1998, TotalEnergies Egypt is among the top four fuel retail operators in Egypt. The acquisition marks another important milestone in delivery of Adnoc Distribution’s expansion plans. The partnership with TotalEnergies, a leading global multi-energy company with a strong brand and successful track record in Egypt, includes a diversified portfolio comprising 240 fuel retail stations, 100+ convenience stores, 250+ lube changing stations, and car washes, as well as wholesale fuel, aviation fuel, and lubricant operations.
Egypt: An attractive market
Bader Saeed Al Lamki, CEO of Adnoc Distribution, said Egypt’s fuel retail market is highly attractive with exciting potential for future growth.
“Due to its young and expanding population, alongside a series of progressive economic reforms, Egypt has recorded positive GDP growth with a strong outlook,” he said.
He said this acquisition by Adnoc Distribution reaffirms “our commitment to expanding our business” in attractive international growth markets.
“It is a testament to our ability to leverage our experience in both fuel and non-fuel retail, to deploy cash to accelerate our international expansion, and to realise natural business synergies and partnership opportunities that allow us to quickly and efficiently enter new and dynamic markets,” he said.
Earnings accretive to Adnoc Distribution
Al Lamki said the acquisition will be earnings accretive to Adnoc Distribution from the first year post closing.
“We look forward to providing the best possible service to customers in Egypt, and working with TotalEnergies to accelerate our international expansion in Egypt and beyond,” he said.
Thierry Pflimlin, president Marketing & Services at TotalEnergies, said TotalEnergies is pleased to be joining forces with Adnoc Distribution in Egypt.
“The rich experience of the leading fuel distributor in the UAE will bring substantial added value to TotalEnergies Egypt. We look forward to collaborating with Adnoc Distribution in its international growth strategy,” he said.
— muzaffarrizvi@khaleejtimes.com
Muzaffar Rizvi
Muzaffar Rizvi is an accomplished financial journalist with more than 25 years of experience in the UAE and Pakistan. He has good writing skills, strong grip on production and an excellent news sense.
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