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22 March 2020

BlackRock, Italy’s Snam bid for stake in $15 billion ADNOC unit

Abu Dhabi state energy giant seeks to sell as much as 49 per cent of the business through a lease structure

KKR, GIC and BlackRock agreed to invest $4 billion in ADNOC’s oil pipeline network last year/Bloomberg

by Bloomberg

BlackRock, KKR & Co. and Italian infrastructure operator Snam are among suitors that made initial bids for a stake in Abu Dhabi National Oil Company’s (ADNOC) natural gas pipelines, which could be valued at about $15 billion.

The firms are competing with other bidders including Australian fund manager IFM Investors and Ontario Teachers Pension Plan that submitted first-round offers in recent days. Global Infrastructure Partners and Singapore sovereign fund GIC Pte have also expressed initial interest in acquiring a stake in the business.

ADNOC is deciding when to set a timeline for the next round of offers. Travel restrictions have made in-person meetings and due diligence visits more difficult, and other sale processes have been held up as tightening credit markets hampered bidders’ access to funding.

Abu Dhabi has been opening up the operations of its state-owned oil producer to foreign partners, part of a push to diversify the UAE’s economy and generate additional sources of funding. ADNOC listed its fuel retail unit and sold a stake in its $11 billion drilling business to Baker Hughes Co.

KKR and BlackRock agreed last year to invest $4 billion in ADNOC’s oil pipeline network, securing two decades of guaranteed returns. GIC also bought a stake in the business later.





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