Borouge Plans IPO of Minority Stake

23.05.2022 - Borouge, the Borealis/Abu Dhabi National Oil Co (ADNOC) joint venture, has announced plans to float a 10% stake in the company on the Abu Dhabi Securities Exchange (ADX). The initial public offering (IPO) will make 3 billion shares available, which could reportedly raise about $2 billion.

The offer period will open on May 23 and run to May 28 for retail investors and to May 30 for institutional buyers, with shares expected to start trading on the ADX on Jun. 3.

“Through Borouge and our recently announced 25% equity investment in Borealis, ADNOC is poised to capitalize on the significant industrial and consumer-led growth in the petrochemicals sector over the coming decades. Today’s proposed listing, our fourth company to come to market, is another significant milestone in our highly successful value creation and strategic growth journey,” said Sultan Ahmed Al Jaber, United Arab Emirates Minister of Industry and Advanced Technology, and ADNOC managing director and Group CEO.

The owners of Borouge said the IPO is taking place so they can “more actively manage and optimize their portfolio of assets, create new investment opportunities, increase trading liquidity in the shares of the company and raise its profile with the international investment community.”

Borouge plans to pay dividends to shareholders biannually, depending on its capital expenditure plans and market conditions, among other factors. For the 2022 fiscal year, the group aims to pay a dividend of $325 million in September 2022 plus another $650 million in March 2023. For the 2023 fiscal year, Borouge is planning a dividend of no less than $1.3 billion.

After the IPO, ADNOC expects to own 54% of Borouge’s share capital, while Borealis is expected to own about 36%.

Author: Elaine Burridge, Freelance Journalist