ADNOC L&S Boosts Investment Potential with $2B Hybrid Capital Facility
Deal News | Jan 08, 2025 | Zawya
ADNOC Logistics & Services Plc, the UAE-based energy maritime logistics branch of Abu Dhabi National Oil Company, has issued a hybrid capital facility ranging from $1.1 to $2.0 billion. This financial instrument, blending characteristics of both debt and equity, serves as a strategic move to facilitate growth, including the acquisition of the Singapore-based Navig8 TopCo Holdings Inc., a tanker management entity recognized within an international shipping pool. The inaugural draw from this facility is $1.1 billion, with the capacity extending to $0.9 billion, available for future endeavors through December 2026. Approximately $1 billion from this draw will finance the Navig8 acquisition. The remaining funds are allocated for planned or potential new investments. Arranged by Societe Generale, the facility sees participation from numerous financial institutions, ensuring ADNOC L&S can meet its expansive investment strategy, exceeding $5 billion since its IPO in June 2023. President Captain Abdulkareem Al Masabi articulates that existing cash reserves, this financial facility, and cash flow from contracted vessels solidify ADNOC L&S's financial foundation, allowing for strategic expansion with an aspirational net debt-to-EBITDA ratio target of 2.0 to 2.5 times.
Sectors
- Maritime Logistics
- Oil and Gas
- Banking and Finance
Geography
- United Arab Emirates – ADNOC L&S, based in the UAE, is executing its growth strategy to reinforce its regional dominance in the maritime logistics sector.
- Singapore – Navig8 TopCo Holdings Inc., involved in the acquisition, is a Singapore-based company, integrating the regional maritime operations into ADNOC L&S's portfolio.
- France – Societe Generale, the lead arranger for the facility, is a French multinational investment bank participating in the financial structuring of this capital facility.
Industry
- Maritime Logistics – ADNOC L&S is a key player in the energy maritime logistics sector, focusing on transport and logistics solutions for its parent company and wider oil and gas market.
- Oil and Gas – ADNOC L&S operates under the umbrella of the Abu Dhabi National Oil Company, one of the largest oil companies globally, specializing in energy resource management.
- Banking and Finance – The transaction involves several participating banks that finance the hybrid capital facility, crucial to managing capital structures and funding large-scale acquisitions in the maritime and energy sectors.
Financials
- $2 billion – Total value of the hybrid capital instrument issued by ADNOC L&S.
- $1.1 billion – Initial drawdown from the hybrid capital facility.
- $0.9 billion – Remaining capacity available to be drawn until 31 December 2026.
- $1 billion – Allocated funds from the facility for the acquisition of Navig8 TopCo Holdings Inc.
- $5 billion – Total investment commitment since ADNOC L&S’s IPO in June 2023.
- SOFR +150 basis points – All-in pricing for the first drawdown against the facility.
Participants
| Name | Role | Type | Description |
|---|---|---|---|
| ADNOC Logistics & Services Plc | Issuing entity | Company | A subsidiary of Abu Dhabi National Oil Company focused on shipping and maritime logistics in the energy sector. |
| Abu Dhabi National Oil Company | Parent Company | Company | State-owned oil company in Abu Dhabi, involved in all aspects of the oil and gas industry. |
| Navig8 TopCo Holdings Inc. | Target company | Company | A Singapore-based tanker management company focused on international shipping operations. |
| Societe Generale | Lead Arranger | Company | A French multinational investment bank playing a pivotal role in arranging the hybrid capital facility for ADNOC L&S. |
| Abu Dhabi Commercial Bank | Participant in financing | Company | A financial institution contributing to the hybrid capital facility. |
| First Abu Dhabi Bank | Participant in financing | Company | A financial institution contributing to the hybrid capital facility. |
| Credit Agricole Corporate and Investment Bank | Participant in financing | Company | A financial institution contributing to the hybrid capital facility. |
| BBVA | Participant in financing | Company | A multinational Spanish banking group contributing to the hybrid capital facility. |
| DBS Bank | Participant in financing | Company | A major Singaporean bank contributing to the hybrid capital facility. |
| Captain Abdulkareem Al Masabi | CEO | Person | Chief Executive Officer of ADNOC Logistics & Services. |