Borouge's share price.. ADNOC launches the largest listing in the Abu Dhabi market - Energy

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The Abu Dhabi National Oil Company “ADNOC” continues its strategy to diversify sources of income by announcing, with its strategic partner, “Borealis”, the share price of Borouge – the offering price in the public offering of the petrochemical joint venture – on the Abu Dhabi Stock Exchange, at 2.45 dirhams per share.

ADNOC aims by offering a minority stake in Borouge for public subscription to provide an exceptional opportunity for investors to contribute to a leading company that will play a pivotal role in achieving sustainable growth for the Emirate of Abu Dhabi in particular and the UAE in general.

The announcement of the share price of Borouge makes the company’s market capitalization 73.6 billion dirhams – 20 billion dollars – making it the largest ever listing on the Abu Dhabi Securities Exchange.

ADNOC also plans to implement a capital investment program worth $122 billion – equivalent to 447.7 billion dirhams – in all group companies during the period between 2021-2025 to enable its growth strategy and create and enhance value.

Borouge stock demand

Borouge’s share price has been set for the IPO by ADNOC and Borealis as the selling shareholders, following strong initial demand indications from local and international investors, prior to the official start of the subscription period.

Borouge’s IPO period began today, Monday, May 23, 2022, and will close on May 28 for individual investors in the UAE, and on May 30, 2022 for qualified investors from local and international institutions. It is expected that “Borouge” will be listed. In the Abu Dhabi Securities Exchange on June 3, 2022.

The selling shareholders and the company have entered into major investment agreements with “International Holding Company”, “Multiplay Group”, “Alpha Holdings”, “Holding”, “Abu Dhabi Pension Fund”, “Emirates Investment Authority” and “Adani Group” of India “The Investors” Principals”, in evidence of support for the IPO process and another strong indication of investor demand.

The main investors, in accordance with the agreements, committed in each case, directly or indirectly, to invest 2.1 billion dirhams ($570 million) in the public offering, provided that all shares are subject to a retention period of no less than 6 months.

Borouge stock price
Abu Dhabi Securities Exchange – archive

The capabilities of the UAE company Borouge

Borouge has a strong financial profile, with annual revenues of $5.5 billion in 2021, and one of its companies, Borouge ADP, having annual profits for the year of $1.5 billion.

The company also has a proven track record of generating strong cash flows that supports its ability to pay a competitive dividend in the future.

The company expects to distribute dividends to shareholders during 2022, amounting to 975 million dollars, and it expects to pay during 2023 at least 1.3 billion dollars for the entire year period, equivalent to a dividend yield of 6.5% based on the announced Borouge share price for the offering.

The Selling Shareholders aim to provide a significant opportunity for our contingents to create and increase value, reflecting their confidence in Borouge’s long-term growth path.

A leading company in the production of petrochemicals

The decision to offer also confirms that ADNOC gives priority to strong post-listing performance and a strong dividend policy. Borouge, which was established in 1998 as a joint venture between ADNOC and Borealis, combines the strengths and experience of the two companies, It consists of two separate companies: Abu Dhabi-based Borouge ADP, which handles petrochemical production operations, and Singapore-based Borouge PTE Limited, which is responsible for marketing and sales of Borouge products.

Borouge is one of the world’s leading providers of innovative and diversified solutions of high-value polymers to sectors including agriculture, building and construction, energy and packaging, advanced packaging, transportation and health.

Borouge’s product portfolio includes polyethylene and polypropylene, two of the most widely used polymers in industrial applications such as sustainable packaging, tubes and fittings, cables, automobiles and medical devices.

Borouge’s polymer solutions are categorized into two main divisions: polymer solutions for consumers, and polymer solutions for infrastructure facilities.

Consumer solutions include sustainable packaging, medical containers and greenhouse covers, while infrastructure solutions include water and gas pipelines and power transmission cables.

Borouge stock price
The headquarters of the UAE company, Borouge, which is part of the ADNOC Group

Bruges strategy

The main axes of Borouge’s strategic growth plan are to achieve continuous growth in its product portfolio through innovation, provision of sustainable solutions, product development, access to strategic markets and geographical expansion.

The company will also focus on providing its diverse range of products and innovative industrial solutions to the final markets that offer excellent prices, and benefit from Borealis technology, which enabled Borouge to design special solutions that meet the requirements of its customers and contribute greatly to facilitating daily life.

Borouge will also benefit from ADNOC’s successful investment in Borealis, which was announced recently, which will contribute to strengthening their long-term partnership and accelerating the implementation of the objectives of ADNOC’s growth and expansion program in the field of refining, petrochemicals and industrial operations.

ADNOC plans to take advantage of growth opportunities in the chemical and petrochemical sector, by relying on its world-class refining and petrochemical facilities in the Ruwais Industrial City in Abu Dhabi. Enhancement system.

Borouge, through its subsidiaries, manages one of the largest integrated polyolefin complexes in the Ruwais region, and the company also owns logistics centers in various locations in the region, in addition to storage warehouses and export stations spread in the Middle East, North Africa, Europe and Asia, in addition to a vehicle manufacturing unit. The polymers in Shanghai, in which the resins produced in the Ruwais plant are installed, are used in many industries, including the automotive sector in Asia and other industrial fields such as medical devices, health care supplies and sterilization.

ADNOC Wallet

Over the past 6 years, ADNOC has implemented an effective portfolio management and capital management program, and has developed a model of innovative, more open and flexible strategic partnerships in all aspects of the value chain of its exploration, development, production, refining, manufacturing, marketing and petrochemical businesses.

ADNOC plans to expand the investor base by offering minority stakes in selected companies from its group of operating companies. This started with the initial public offering of ADNOC Distribution in 2017, followed by the listing of ADNOC Drilling shares in October 2021, which is considered the offering The largest in the Abu Dhabi Securities Exchange to date, and put a stake in the public offering in “Vertiglobe”.

The listings contributed to supporting the growth of the private sector and the development of local capital markets, in addition to providing the opportunity for local and international investors to invest in ADNOC’s world-class assets and participate in its growth and development process.

Global Holding Company headquarters
Global Holding Company headquarters

Holding company investments

For its part, the International Holding Company announced that it invested 183 million dirhams ($49.82 million) in the initial public offering of Borouge, whose shares are scheduled to be listed on the Abu Dhabi Securities Exchange.

The company will implement the investment at the initial public offering price, and will adhere to the price range specified for the Borouge share price during the entire subscription period, which was announced this morning.

Sayed Basr Shuaib, CEO and Managing Director of IHC, said: “IHC continues its efforts to consolidate its position as an international institution looking to invest in high-return assets, in line with the ambitions of its strategy to diversify its investment portfolio.

He added, “With the growth of capital markets in the region, specifically the petrochemical sector, we have all the ingredients and capabilities that qualify us to seize the best opportunities, such as investing in the initial public offering of Borouge.”

He pointed out that the step comes in line with the company’s continuous endeavors to invest in companies whose operations depend on renewable and clean energy sources in accordance with the principles of environmental, social and governance responsibility, which in turn contribute to finding innovative solutions capable of addressing the challenges of recycling plastic waste and achieving sustainable long-term gains. .

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