ADNOC — a stronger company after Cornavirus crisis
DUBAI: The Abu Dhabi National Oil Company (ADNOC) said on Tuesday it closed its $5.5 billion real estate investment partnership with entities owned and/or advised by Apollo Global Management Inc. subsidiaries and a group of institutional investors.
The closing takes the combined investment in select ADNOC real estate assets by the investor consortium to $2.7 billion, the company said in a statement.
“The strategic investment will leverage the rental income streams from select ADNOC real estate assets under a 24-year master lease agreement,” it added.
Under the real estate transaction, which ADNOC said was one of the region’s largest the Apollo-led consortium collectively holds a 49 percent stake in Abu Dhabi Properly Leasing Holding Company RSC Limited, a wholly-owned ADNOC affiliate. ADNOC retains a 51 percent majority stake, according to the statement. Maintaining full ownership and control over the select real estate and social infrastructure assets, it added
“This strategic partnership allows ADNOC to unlock and monetize significant value from its non-oil and gas strategic infrastructure assets and reinvest into our core business to deliver further growth and realize greater returns,” ADNOC’s CEO Sultan Al-Jaber said.
The deal comes as the world’s top oil and gas companies, including ADNOC, try to control costs in response to the coronavirus pandemic that has reduced oil demand and prices.
In June, ADNOC signed a $10 billion deal to lease its natural gas pipeline assets to a group of investors, under a newly formed subsidiary ADNOC Gas Pipelines, for 20 years in return for a volume-based tariff.
Four years ago, ADNOC started a transformation strategy to adapt more quickly to market changes, and the company has said it would continue to work with investors to attract foreign capital and maximize value from its resources.