The deal starts what’s likely to be a flurry of listings out of the Gulf, following on from last year’s strong showing.
Shares of Adnoc Gas rose as much as 25% to 2.97 dirhams in early trading in the emirate. The stock priced at 2.37 dirhams per share, roughly the middle of the marketed IPO range, even though investors placed almost $125 billion of orders.
State-owned Adnoc sold a 5% stake in the company, which made record earnings in the year through October as Russia’s invasion of Ukraine roiled energy markets and sent natural gas prices surging. Cornerstone investors including Abu Dhabi state-linked firms subscribed to $850 million worth of shares ahead of the final pricing announcement.
The deal is a sign of continued feverish appetite for IPOs from the Gulf as governments try to fund a transition away from fossil fuels and bring more international investors into their markets.
The initial public offering is the biggest-ever in Abu Dhabi, surpassing chemicals firm Borouge’s $2 billion deal in mid-2022. In addition to Borouge, Abu Dhabi National Oil Co. has sold stakes in two units last year — Adnoc Drilling and fertilizer firm Fertiglobe, and is potentially working on a listing of its shipping unit, Bloomberg reported in November.
Abu Dhabi is likely to be at the forefront of the Middle East’s IPO market this year. At least eight companies are expected to list in the emirate, a senior government official told Bloomberg this month.
Potential deals span industries from technology to media and asset management. G42, an Abu Dhabi-based artificial intelligence company, is considering at least six IPOs, while Investcorp Holdings is weighing an offering of its investment vehicle in the emirate in the first listing of its kind in the region, Bloomberg reported.
First Abu Dhabi Bank PJSC and HSBC Holdings Plc led Adnoc Gas’s IPO.