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UAE’s ADPower offers assets swap deal to its subsidiary TAQA [free access]

February 3, 2020

Abu Dhabi Power Corporation (ADPower), a subsidiary of government-owned Abu Dhabi Development Holding Company PJSC, has submitted an offer for transferring majority of its electricity generation, transmission and distribution (T&D) and water companies to one of its subsidiaries – Abu Dhabi National Energy Company (TAQA), in return for 106,367,950,000 convertible shares in the latter and termination of the land lease agreement between both the companies. Post completion of the deal, ADPower’s share in TAQA will increase from 74.4 per cent to 98.60 per cent.


The water and electricity generation, and T&D firms which ADPower is proposing to transfer, include, 4.9 GW of power generation capacity, 80,000 km of T&D network, and about 20,000 km of water pipeline network, and reportedly had a total net income of AED4.8 billion and total assets of AED120 billion by the end of 2018.


As per reports, the proposed transaction will create an AED200 billion worth giant combined entity, aimed at accelerating the transformation of the water and electricity industry in the United Arab of Emirates (UAE). The combined entity will be one of the largest Gulf Cooperation Council (GCC) utility companies, and one of the top 10 integrated utility players in the Europe, the Middle East and Africa (EMEA) region in terms of regulated assets.


The offer is subject to various approvals, including by the Abu Dhabi Department of Energy (DoE), the Securities and Commodities Authority (SCA), and TAQA shareholders. The transaction is expected to close by the second half of 2020.


ADPower owns majority of the water and electricity assets across Abu Dhabi, UAE, through its subsidiaries Emirates Water and Electricity Company (EWEC), Abu Dhabi Transmission and Despatch Company (TRANSCO), Abu Dhabi Distribution Company (ADDC), Al Ain Distribution Company (AADC), Al Mirfa Power Company (AMPC), Abu Dhabi Energy Services (ADES) and the Abu Dhabi Securities Exchange (ADX)-listed TAQA.