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AD Ports Shares Soar as Sovereign Wealth Fund L'imad Moves to Acquire Remaining Stake

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AD Ports Shares Soar as Sovereign Wealth Fund L'imad Moves to Acquire Remaining Stake

Shares in Abu Dhabi Ports (ADX:ADPORTS), d/b/a AD Ports Group, rose sharply on Monday after its majority owner launched an offer to acquire the remaining stake in the port and industrial zones developer.

Abu Dhabi Developmental Holding, a subsidiary of the emirate's sovereign wealth fund L'imad Holding, is offering to buy out the minority shareholders at 6.25 Emirati dirhams per share. It currently holds a 75.42% stake in AD Ports.

The offer price represents a 23% premium to AD Ports' Aug. 14 closing price of 5.10 dirhams and a 25% premium to its one-month volume weighted average price of 5.02 dirhams.

The news sent AD Ports soaring, with the stock up nearly 15% in early trading in Abu Dhabi.

"L'imad expects AD Ports' growth journey to be complex, capital intensive and long-term in nature, requiring the company to contemplate equity raises and/or further burdening its balance sheet, which may not align with the short to medium-term expectations of public market investors," Abu Dhabi Developmental said in the offer document.

The offeror added that the potential deal would give shareholders "a compelling liquidity opportunity to monetise their full investment immediately," citing the port operator's "recently announced transactions and resulting elevated financial leverage levels" as limiting its capacity to pay dividends to shareholders.

"To continue supporting AD Ports' growth in this increasingly challenging and capital-intensive environment, L'imad believes that acquiring the remaining shares in AD Ports will enable the company to pursue its long-term strategic objectives more effectively," the offeror said.

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