ADQ Plans to Combine Abu Dhabi National Hotels Company With Abu Dhabi National Exhibitions Company
Main Photo: The Park Hyatt Abu Dhabi, one of the 28 hotels in the deal
Date: June 2021
Location: Abu Dhabi, Al Ain & London
Name: Abu Dhabi National Hotels Company and Abu Dhabi National Exhibitions Company
No. of Keys: 28 hotels – 6,700
Owner: Abu Dhabi Fund ADQ has proposed combining Abu Dhabi National Hotels Company PJSC with one of its portfolio companies, Abu Dhabi National Exhibitions Company PJSC
The combined group would have assets of approximately $5.4bn as of December 31 2020. Abu Dhabi sovereign investment fund ADQ has submitted an offer to create a company with $5.4 billion in assets in a “strategic combination” of two local hospitality groups, part of an effort to form a larger entity that will support the emirate’s long-term diversification plans.
ADNH shares jumped as much as 15 percent on Wednesday, the maximum allowed by the local exchange, and headed for the highest closing price since 2010. The proposed transaction “would create one of the largest hospitality, events, and catering powerhouses in the region” and would help attract more tourism and business travel to the emirate, ADQ said.
The combined group would have a portfolio of 28 owned and operated hotels, three large exhibition centres in Abu Dhabi, Al Ain and London, in addition to catering companies and food and beverage outlets. The hiotels include Ritz-Carlton, Park Hyatt, Sofitel Sheraton and several others in Abu Dhabi and Dubai.
The combined group would be well-positioned for revenue growth opportunities and cost synergies, along with a stronger, more efficient capital structure. The transaction is expected to be “earnings accretive shortly after completion”.
ADNH will 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 instrument will convert into shares in ADNH is AED3.93 per share.
The offer implies an equity value of approximately AED3.93bn for ADNH. Following completion, ADQ would own approximately 54.98 percent of the entire issued share capital of ADNH.
THPT Comment: Take 28 of the Emirates most fabulous hotels, add three major exhibition centres and this is what you get with this deal.
First Seen: Arabian Business
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