Abu Dhabi Firms Deepen Stake in Oil and Gas Engineering Company

ADNOC Drilling, a subsidiary of the Abu Dhabi National Oil Company (ADNOC), and investment holding company Alpha Dhabi Holding have announced a significant expansion of their partnership in the oil and gas engineering sector. Through their joint venture (JV) Enersol RSC LTD, the companies have agreed to acquire an additional 42. 2% stake in Gordon Technologies LLC for approximately $270 million.

This acquisition will make Enersol the majority shareholder in Gordon Technologies, increasing its ownership from 25% to 67. 2%. The deal follows Alpha Dhabi Holding's initial investment of $164 million for a 25% stake in Gordon Technologies in November 2022. Earlier this year, the two Abu Dhabi companies established Enersol, with Alpha Dhabi contributing its existing holding in Gordon Technologies to the JV.

The latest agreement reflects the strategic ambitions of both ADNOC Drilling and Alpha Dhabi Holding. ADNOC Drilling, a leading provider of drilling services in the region, seeks to expand its footprint in the oil and gas value chain by acquiring expertise in upstream engineering solutions. Alpha Dhabi Holding, on the other hand, is actively pursuing investments in sectors that align with Abu Dhabi's economic diversification goals.

The acquisition price for the additional stake in Gordon Technologies was determined using the same valuation metrics employed for the initial 25% purchase. This approach ensures consistency and transparency in the overall investment strategy. Notably, around 80% of the consideration for the newly acquired stake will be financed upon closing the deal.

This move by the Abu Dhabi companies is expected to unlock significant synergies between the parties involved. Gordon Technologies' expertise in engineering solutions for the oil and gas industry, coupled with ADNOC Drilling's operational experience and Alpha Dhabi Holding's investment acumen, presents a compelling combination for growth.

The enhanced partnership is likely to benefit Gordon Technologies by providing access to new resources, markets, and technical capabilities. This could fuel the company's expansion plans and solidify its position as a key player in the oil and gas engineering landscape.

The transaction is subject to customary regulatory approvals. However, with strong strategic alignment and a clear financial commitment, the deal is anticipated to be completed successfully. This development underscores the growing appetite of Abu Dhabi-based companies for strategic investments within the oil and gas sector, particularly in areas with high-growth potential.

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