ADNOC's joint venture with Alpha Dhabi, called Enersol, was launched in November last. The mandate is to invest up to $1.5 billion into tech-enabled oilfield and energy businesses. Image Credit: Afra Al Nofeli/Gulf News

Dubai: The ADNOC joint venture with Alpha Dhabi is raising its stake in the US engineering firm Gordon Technologies in a deal valued at around $270 million. Enersol, the joint venture, will thus own an additional 42.206 per cent in Gordon, after the 25 per cent it acquired in January.

About 80 per cent of the deal value for the new stake will be funded upon closing. The remaining is expected to be paid in the next two years, 'subject to certain performance conditions'. Gordon Technologies is debt-free, and its 'acquisition is economically accretive to Enersol from a profitability, valuation multiple, cash flow generation and dividend potential standpoint'. Plus, there is a FY-2023 free cash flow yield of more than 10 per cent.

The US company is a provider of Measurement While Drilling (’MWD’) technology to the oil and gas industry. This measures key information near the drill bit and transmits data to the surface without interrupting normal drilling operations. Gordon completed setting up its Abu Dhabi business with the intention to start field operations in the MENA region in Q2-2024.

Launched in November last, the ADNOC-Alpha Dhabi venture, Enersol is 'actively advancing' plans to acquire and/or invest in multiple businesses. The plan is to 'foster a scalable ecosystem that will enhance market value and improve operational efficiencies'.

"A major driver of investment decisions will be the ability of those investments to support the UAE’s wider energy security ambitions, Net Zero agenda and ongoing economic diversification efforts," said a statement.