Consortium led by Apollo Global Management is set to buy a 49% stake in ADNOC’s property leasing unit
Abu Dhabi National Oil Company (ADNOC) on Wednesday announced that it has entered into one of the region’s largest real estate transactions, valued at $5.5 billion.
The long-term investment has been agreed with Apollo Global Management and its subsidiaries, one of the world’s largest alternative investment managers, and a group of institutional investors.
The deal will leverage the rental income streams from select ADNOC real estate assets under a 24-year master lease agreement.
ADNOC said in a statement that it will unlock new pools of global institutional long-term capital while supporting investment in its core business and strategic growth projects.
Apollo led a consortium of institutional investors in the acquisition of a 49 percent stake in Abu Dhabi Property Leasing Holding Company RSC Limited, a wholly owned affiliate of ADNOC.
ADNOC will retain a 51 percent majority stake, maintaining full ownership and control over the select real estate and social infrastructure assets and responsibility for all operations and maintenance, the statement said.
It added that the transaction will result in upfront proceeds of $2.7 billion to ADNOC and is expected to close before year-end, subject to customary closing conditions and regulatory approvals.
Dr Sultan Al Jaber, UAE Minister of Industry and Advanced Technology and ADNOC Group CEO, said: “This strategic partnership allows ADNOC to unlock and monetise significant value from its non-oil and gas strategic infrastructure assets and reinvest into our core business to deliver further growth and realise greater returns.”
Leon Black, Apollo chairman, CEO and founder, said: “We are pleased to invest in ADNOC’s real estate portfolio… Sourcing and structuring a long-term institutional investment of this nature is demonstrative of Apollo’s unique ability to embrace complexity and tailor investments to a company’s specific objectives.”
Since announcing the expansion of its partnership and investment model in 2017, designed to unlock value for the UAE and Abu Dhabi, ADNOC has entered the debt capital markets for the first time and also recently closed landmark investment partnerships with leading global institutional investors and operators in both its oil and gas pipeline infrastructure.
