ADNOC Settles Exchangeable Bonds in ADNOC Distribution

Abu Dhabi National Oil Company (ADNOC) confirmed the full redemption of its exchangeable bonds in ADNOC Distribution on June 4, 2024. The bonds, denominated in US dollars, were issued in May 2021 alongside an offering of roughly 375 million shares in ADNOC Distribution.

The redemption reflects ADNOC's commitment to responsible financial management and capital structure optimization. By opting for a cash settlement instead of share conversion, ADNOC retains full ownership of the underlying ADNOC Distribution shares, representing approximately 7% of the company's registered share capital. This approach maintains ADNOC Distribution's free float at 23%, with ADNOC holding the remaining 77% as majority shareholder.

The exchangeable bonds came with a put option allowing investors to convert them into ADNOC Distribution shares by May 4, 2024. With the expiry of this option, ADNOC elected to redeem the bonds entirely through a cash payment of $1. 195 billion along with applicable interest of $4. 18 million. This move streamlines ADNOC's financial portfolio and simplifies financial reporting by eliminating a complex financial instrument.

ADNOC's initial distribution of ADNOC Distribution shares in 2021 has proven to be a success story, generating significant value for shareholders. The company remains a strong supporter of ADNOC Distribution's long-term growth strategy and future achievements. This full redemption signifies ADNOC's financial strength and its dedication to optimizing its capital structure while ensuring transparency and certainty for its investors. The move also reinforces ADNOC's commitment to ADNOC Distribution's continued success as a partially privatized entity.

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