Abu Dhabi - Mubasher: The Abu Dhabi National Oil Company (ADNOC) on Monday announced the issuance and closing of a $3 billion bond by Abu Dhabi Crude Oil Pipeline (ADCOP), a fully-owned subsidiary.
The bond offering comprises two senior secured bond tranches: an $837 million 12-year tranche (Series A) and a $2.2 billion 30-year tranche (Series B), according to a company statement.
The offering was oversubscribed by over 3.5 times with orders exceeding $11 billion from both international and regional accounts, ADNOC revealed.
The bond was rated AA by both Fitch and Standard and Poor’s (S&P), stressing ADNOC’s financial strength and stability.
The proceeds will be used by ADNOC to support its ambitious future growth and investment plans.
The 12-year tranche was allocated geographically to Asian, European, and American investors as well as to investors from the Middle East and North Africa (MENA) region by 8%, 42%, 43%, and 7%, respectively.
The tranche was divided as follows: 8% to banks and private banks, 70% to fund managers, and 22% to agencies, pensions, insurance and others entities.
Meanwhile, the 30-year tranche was allocated geographically to Asian, European, American, and MENA region investors by 10%, 35%, 51%, and 4%, respectively, and divided among investors at 6% to banks and private banks, 80% to fund managers, and 14% to agencies, pensions, insurance and others entities.
“The very attractive pricing and substantial international demand for this offering positively reflects the UAE’s stable investment environment, as well as ADNOC’s new and progressive approach to its long-term financing strategy, said Sultan Ahmed Al Jaber, ADNOC’s CEO.
“This bond represents an important, initial milestone in our efforts to fully optimise our capital structure in a smarter, more efficient and flexible manner,” the top official added.
Al Jaber noted that this deal gives ADNOC access to international debt markets and provides various options for ADNOC Group’s long-term financing.
ADCOP owns a pipeline which covers around 406 kilometres and carries ADNOC Onshore’s crude oil to the Fujairah oil export terminal. It also allows the direct transport of a large portion of the UAE’s crude oil from Abu Dhabi to the Arabian Sea.
The pipeline is designed to transport 1.5 million barrels per day of crude oil.
“First Abu Dhabi Bank (FAB), HSBC, JP Morgan and Mitsubishi UFJ acted as Global Coordinators and Joint bookrunners, while BNP Paribas, Citigroup, Mizuho Securities, Société Générale and Standard Chartered Bank acted as Joint Lead Managers,” ADNOC stated.
