Borouge to sell 10% of shares in IPO as it lists on ADX

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Abu Dhabi National Oil Company (ADNOC) and its Austrian chemicals partner Borealis AG are planning an initial public offering (IPO) of their petrochemicals joint venture Borouge on the Abu Dhabi Securities Exchange (ADX).

Borouge, a specialty plastics firm that produces polyolefins used in items such as cars and food packaging, said its offering will consist of approximately three billion existing shares, representing 10 percent of the company’s issued share capital, the company said in an announcement on Wednesday.

The offering marks the latest step in Abu Dhabi state energy group’s asset monetisation programme that the company embarked on more than four years ago, building an investment team to monetise assets and raise funds from international private equity groups.

The offering will open May 23 and run to May 28 for retail investors and May 30 for institutional buyers, the company said in an intention to float (ITF) document. Shares are expected to be admitted for trading on the ADX on June 3.

Borouge said it plans to pay dividends to its shareholders biannually, and its ability to pay will depend on factors such as its capital expenditure plans, availability of distributable reserves and market conditions.

For the financial year 2022, it plans to pay a dividend in September of $325 million and a further $650 million the following March. For the financial year 2023, it said it plans to pay a dividend of no less than $1.3 billion.

Last year ADNOC listed its drilling business in Abu Dhabi’s largest IPO to date and Fertiglobe, a joint venture between ADNOC and chemical producer OCI. ADNOC also floated shares in its distribution business in 2017.

Gulf states plan to raise tens of billions of dollars through sales of stakes in energy assets, capitalising on a recovery in crude prices to attract foreign investors.