Borealis and ADNOC Said Hiring Banks for IPO

16.02.2022 - Plastics and fertilizer producer Borealis and Abu Dhabi National Oil Co (ADNOC), the United Arab Emirates’ largest oil company, are lining up banks to help arrange a potential listing of their plastics venture Borouge, the Bloomberg news agency has reported.

The listing could take place “within months,” Blooomberg said. Among the banks already signed on for the listing, its sources cite Citigroup, HSBC Holdings and First Abu Dhabi Bank PJSC.

Vienna-based Borealis and ADNOC have been partners in the Borouge joint venture since the late 1990s. Speculation about the IPO details follows a statement released by the two companies on Feb. 14. In the brief communication, they said they were “considering” an initial public offering for the JV.

Bloomberg’s sources said the companies also plan to hire additional banks for the listing that could take place as early as mid-2022 and that Borouge, which currently employs more than 3,000 people at three chemical complexes, could be valued at about $20 billion or more.

The partners recently agreed to build a fourth complex at Ruwais, Abu Dhabi. Expected to be on stream by the end of 2025, the $6.2 billion investment would be the world’s largest single-site polyolefin complex, consisting of a 1.5 million t/y ethane cracker, two PE plants producing 1.4 million t/y and a 100,000 t/y cross-linked PE plant. Bloomberg said the companies are currently negotiating $2.75 billion in financing from international banks to help fund the JV’s expansion.

Borealis is owned by Austrian refiner OMV and Abu Dhabi’s Mubadala investment company. Earlier this month, the chemical company said it planned to divest a fertilizer business and would announce a new long-term strategy in March. EuroChem, a Russian-owned fertilizer producer headquartered in Zug, Switzerland, said last week it had begun exclusive negotiations to buy the nitrogen assets for €455 million. The deal could complete in the second half of 2022.

In 2021, UAE-state-owned ADNOC raised nearly $2 billion from listing two of its subsidiaries, and according to Bloomberg, it plans to sell its first bonds this year to refinance liabilities and help expand the emirate’s debt markets.

Author: Dede Williams, Freelance Journalist