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Abu Dhabi firms in talks for $12bn real estate and tourism giant

Adnec Modon merger Wam
Adnec Group, which would be merged with leisure and tourism-focused developer Modon, owns the largest exhibition space in the Middle East
  • Plan would ‘enhance Abu Dhabi’s position in real estate and hospitality’
  • Combined group would be worth AED44 billion ($12 billion)
  • ADQ and IHC Capital would share ownership with Q Holding

Abu Dhabi’s ambitions to rival its neighbour Dubai as a global events destination have stepped up a notch with talks to create one of the largest real estate, hospitality, events and catering platforms in the region.

Sovereign wealth fund ADQ and IHC Capital Holding have submitted an offer to wrap some of their shareholdings into real estate and hospitality investment firm Q Holding, according to a filing to the local stock market.

As part of the offer, Q Holding will combine with ADQ’s 100 percent shareholding of Abu Dhabi National Exhibitions Company (Adnec), owner and operator of the largest exhibition venue in the Middle East.

Stakes owned by ADQ and IHC Capital in leisure and tourism-focused developer Modon will also become part of the new Q Holding entity.

The combined group would be worth AED44 billion ($12 billion) and would “enhance Abu Dhabi’s position as an integrated real estate and hospitality leader,” a statement said.

The statement added that the larger balance sheet and robust cash flows would provide the combined entity with increased financial flexibility, enabling more strategic investments, debt reduction and potential shareholder distributions. 

Mohamed Hassan Alsuwaidi, managing director and CEO at ADQ said: “This proposed offer provides a unique opportunity to generate value by bringing together key real estate and hospitality assets, creating an Abu Dhabi champion that fuels its ambitions.

“The combined assets would benefit from increased scale and new revenue opportunities that will position it well for future growth.”

Syed Basar Shueb, IHC’s CEO and managing director, added that the new group would bridge the gap between the tourism and real estate sectors.

“We firmly believe that the proposed transaction will prove to be significantly beneficial to the growth and the development of the industry,” he said. 

Following completion, ADQ and IHC Capital would respectively own about 38.7 percent and 19.4 percent of the entire issued share capital of Q Holding.

If the Board of Q Holding recommends proceeding with the transaction, it will be subject to shareholder and regulatory approvals.

ADQ is one of the region’s largest holding companies, with investments in more than 90 companies locally and internationally. 

IHC, meanwhile, has become the most valuable listed holding company in the Middle East with a market cap of AED648 billion as of the end of September 2022. It has 82,000 employees and more than 420 subsidiaries.