Abu Dhabi: ADQ, one of the region's largest holding companies has submitted an offer to Abu Dhabi National Hotels Company (ADNH) for a strategic combination of ADQ’s Abu Dhabi National Exhibitions Company (ADNEC) with ADNH.
The proposed transaction would create one of the largest hospitality, events, and catering powerhouses in the region that would enhance Abu Dhabi’s tourism and hospitality sectors and position them for the Emirate’s longer-term, economic transformation.
The combination seeks to provide greater synergies through better alignment and repositioning of key assets within ADNEC’s portfolio, and is expected to be earnings accretive shortly after completion.
The activities of the resulting company would comprise a portfolio of 28 owned and operated hotels with a total of approximately 6,700 rooms, three large exhibition centres in Abu Dhabi, Al Ain and London (UK) as well as several catering companies and food and beverage outlets.
In consideration for the transfer of the shares in ADNEC to ADNH, ADNH would issue to ADQ a convertible instrument that would convert into 1,221,374,045 ordinary shares in the capital of ADNH upon closing of the transaction. The price at which the convertible instrument will convert into shares in ADNH is approximately Dh3.93 per share. The offer implies an equity value of approximately Dh3.93 billion for ADNH. Following completion, ADQ would own approximately 54.98 per cent of the entire issued share capital of ADNH.
“This proposed offer provides a unique opportunity to create value by bringing together two major players in Abu Dhabi’s hospitality and events sector,” said Mansour AlMulla, Chief Investment Officer, Alternative Investments and Mergers & Acquisitions, ADQ “The combined company would benefit from increased scale, new revenue opportunities, and an enhanced capital structure that will position it well for future growth.”