Abu Dhabi National Oil Co. (ADNOC) plans to sell 7.5% of its drilling unit in an initial public offering (IPO) as it seeks to monetize assets and invest in growth projects. Shares of ADNOC Drilling will be sold on the Abu Dhabi Securities Exchange. This will mark ADNOC’s second IPO after raising $851 million from selling 10% of fuel retailer ADNOC Distribution in 2017. In 2020, ADNOC raised $1 billion from institutional placement of another 10% of shares of ADNOC Distribution.
ADNOC Drilling is the biggest drilling company in the Middle East. ADNOC owns 95% of it, while Baker Hughes holds the remaining 5%. Baker Hughes will not divest its stake as part of the IPO, ADNOC said. The IPO on the bourse is currently expected in October.
ADNOC has been monetizing assets to raise cash to fund strategic projects. In 2020, it inked a deal worth more than $10 billion to sell a 49% stake in its gas pipelines to a group of investors. A year earlier, it signed a similar deal worth $5 billion to sell a 49% stake in its crude oil pipelines. The company needs cash to fund to expand its crude oil production capacity from 4 million bpd currently to 5 million bpd by 2030.
