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Adnoc set to close $3.6b Fertiglobe acquisition

Covestro was energy giant’s biggest-ever acquisition

Abu Dhabi National Oil Company (Adnoc) will complete the $3.62 billion acquisition of OCI’s 50 per cent + 1 share stake in Fertiglobe on Monday.

The acquisition of Fertiglobe, a leading producer of nitrogen fertilisers and clean ammonia solutions, comes in the wake of Adnoc’s mega deal to buy German chemicals maker Covestro for $16.3 billion, including debt, in the energy giant’s biggest-ever acquisition.

Covestro is an industrial pioneer and a global leader in the high-tech specialty chemicals space, boasting a suite of cutting-edge technologies and a range of products that support decarbonisation and the circular economy

The deal, which has received all required approvals, will make the UAE’s oil giant the majority shareholder in Fertiglobe, increasing its shareholding to 86.2 per cent, with 13.8 per cent remaining in free float on ADX.

The management of the Abu Dhabi-based Fertiglobe will host an investor and analyst webcast on Tuesday where the company’s vision to unlock further growth and value will be presented, Adnoc said in a statement.

Recently, Adnoc Logistics and Services announced that its board of directors approved the distribution of a cash dividend of $136.5 million (Dh501.3 million) for the first half (H1) of 2024, equivalent to 6.78 fils per share.

The company intends to distribute a total dividend amount of Dh1.002 billion for the full year, a 5.0 per cent increase on the 2023 annualised dividend, in line with its approved dividend policy.

Since the start of 2024, Adnoc L&S has announced the commissioning of eight to 10 LNG carriers, two to four Very Large Ammonia Carriers, and nine Very Large Ethane Carriers, and has announced the ongoing acquisition of Navig8. With these milestones, Adnoc L&S has increased its global footprint, capabilities, services and market-leading energy-efficient fleet.

Meanwhile, Adnoc Onshore, another Adnoc subsidiary, has partnered with Engineering for the Petroleum and Process Industries (ENPPI) to source steel pipes from local manufacturers for projects across its onshore fields, strengthening the UAE’s industrial sector and creating 50 engineering jobs for UAE nationals in the process.

Through its In-Country Value (ICV) programme, the oil giant is prioritising local sourcing and manufacturing, boosting the UAE’s industrial capabilities and reducing dependence on imports, further advancing the establishment of a self-reliant and diverse economy.

These local manufacturers have tapped into the Dh90 billion that Adnoc has allocated for critical industrial products in its procurement pipeline by 2030.

Local manufacturers, including Al Gharbia Pipe Company and SeAH Steel UAE, will produce the steel pipes, further enhancing the local supply chain. Other UAE-based companies, such as FTV Proclad UAE, NMDC Energy, Bredero Shaw International, ArcelorMittal and Hilong Petroleum Pipe Company will provide specialised services, while Arabian Fiber Optic Cable Manufacturing will supply the fiber optic cables integrated into the pipes to enable the digitalisation of operations.

Omar Al Nasri, Adnoc Onshore CEO, said that the company is proud to continue collaborating with its partners to boost the UAE’s industrial and economic growth. “Our partnership with ENPPI will generate significant local manufacturing opportunities that will support the growth of the UAE’s industrial base and create high-skilled private sector jobs for UAE nationals,” he added.

Since its inception, Adnoc’s ICV programme has created 11,500 jobs for Emiratis in the private sector and redirected Dh187 billion back into the UAE’s economy.

By focusing on opportunity creation, Emiratisation, diversification and industrialisation, ADNOC’s ICV programme aims to inject Dh178 billion back into the UAE’s economy by 2028. These goals underline Adnoc’s support for the ‘Make It in the Emirates’ initiative, which seeks to boost the UAE’s socioeconomic development and growth, the oil giant has said