UAE’s Borouge will become the latest IPO in a wave of Middle East listings

The lure of high dividends has been a major draw for global investors amid a recent wave of mega-quotes in the Gulf region.

Rustam Azmi | Getty Images

DUBAI, United Arab Emirates – Borouge, a petrochemical company, will go public on the Abu Dhabi stock exchange next month, marking the latest in a series of mega public offerings across the Middle East.

Borouge, a joint venture between the Abu Dhabi National Oil Company and the Austrian Borealis, will sell 3 billion shares in the initial public offering, equal to a 10% stake. No price range was provided.

“Together with our longtime partner Borealis, I am delighted to announce our intention to launch a minority stake in Borouge,” Sultan Al Jaber, UAE Minister of Industry and Advanced Technology and Administrator, said in a statement. delegate and CEO of the ADNOC group Wednesday.

“Through Borouge and our recently announced 25% equity investment in Borealis, ADNOC is poised to take advantage of the significant industrial and consumer-led growth in the petrochemical sector over the coming decades,” he added.

The IPO could raise up to $ 2 billion when it goes public on the Abu Dhabi stock exchange on June 3, according to reports. ADNOC is expected to hold approximately 54% of Borouge’s share capital after the listing, while Borealis will hold approximately 36%.

“Borouge has become one of the world’s leading petrochemical companies in creating polyolefin solutions since its founding in 1998, supported by our shareholders, ADNOC and Borealis,” said Borouge Hazeem CEO Sultan Al Suwaidi in a statement.

“The demand for our innovative polyolefin solutions is set to increase in the years to come, driven by our differentiated products and technologies, our commitment to sustainable solutions and operations and strong industry growth trends,” he added.

ADNOC and Borealis have said that the subscription period for retail investors will be May 23-28, while qualified investors will be able to buy shares from May 23-30. Borouge said investors will receive dividends twice every fiscal year, including fixed dividends of $ 325 million in September 2022 and $ 650 million in March 2023.

Borouge has facilities in Abu Dhabi, Shanghai and Singapore, employs more than 3,000 people and has clients in 50 countries in the Middle East, Africa and Asia.

Wave of the Middle East

The lure of high dividends has been a major draw for global investors amid a recent wave of mega-quotes in the Gulf region, led by Saudi Arabia and the UAE.

Both countries are actively taking advantage of strong demand and high energy prices to go public with state-owned companies.

Borouge’s IPO also marks the latest in a series of public offerings by Abu Dhabi-based ADNOC Group, including the listing of ADNOC Distribution, ADNOC Drilling’s $ 1.1 billion offering last year and the recent listing of the fertilizer company Fertiglobe, while ADNOC seeks to unlock value in all its businesses.

The February listing of Abu Dhabi Ports also marked a milestone in the development of the UAE’s capital markets, which have improved in depth and sophistication in recent years.

Neighboring Dubai has also sought to tap into investor demand in the region by undertaking a major IPO push, with state utility DEWA launching a $ 6.1 billion offer last month.

Dubai plans to go public with up to a dozen state-owned companies in the coming months and has recently launched an SPAC framework in an effort to attract new investment.

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