UAE’s ADNOC Gas shares surge 25% in $2.5bn IPO

UAE’s ADNOC Gas shares surge 25% in $2.5bn IPO

Shares in the United Arab Emirates' ADNOC Gas soared 25 percent in opening trade on Monday in a $2.5 billion initial public offering that aims to tap into growing demand for the fuel.

ADNOC Gas, a subsidiary of state-owned energy giant Abu Dhabi National Oil Company (ADNOC), rose to 2.96 dirhams ($0.80) from its launch price of 2.37 dirhams.

ADNOC Gas, which only became operational at the start of this year, is the biggest flotation yet on the Abu Dhabi stock exchange.

The IPO was heavily oversubscribed even after it was expanded from 4.0 to 5.0 percent of issued share capital in response to strong interest.

The final offer price of 2.37 dirhams, near the top of its range, implied a market capitalisation of around $50 billion.

At more than 50 times oversubscribed, it was the biggest demand ever seen for an initial public offering in the Middle East and North Africa, outstripping oil firm Saudi Aramco's world-record $29.4 billion listing just over three years ago.

The rapidly organised IPO follows last year's scramble for alternative gas resources after Russia's invasion of Ukraine, and comes as countries search for cleaner fuels to mitigate global warming.

- 'Transition fuel' -

ADNOC, the United Arab Emirates' key revenue-earner, retains