DUBAI: The UAE’s biggest convenience-store operator has announced it is going to sell 10 percent of its shares on the Abu Dhabi Securities Exchange (ADX) in an initial public offering (IPO) that could value it at as much as $8 billion.
The announcement was made at the Abu Dhabi International Petroleum Exhibition and Conference (ADIPEC), one of the world’s biggest gatherings of leaders in the global energy business.
Retailers at an energy summit — surely the IPO candidate got the wrong venue for the announcement? Not at all, when the prospective issuer is ADNOC Distribution, the fuel retail and wholesale arm of the Abu Dhabi National Oil Co., the country’s powerful national oil company.
As the intention to float (ITF) document boasts: “Its 235 ADNOC Oasis convenience stores as of Sept. 30, 2017 make it the largest retailer in the UAE by number of stores.”
All those essential pit stops we have to make on the country’s busy highways make for a very good business, generating 200 million financial transactions last year. That’s an awful lot of coffee, crisps and cheeseburgers.
Of course, ADNOC Distribution is much more than that as well. It is the No. 1 retail fuel brand in the Emirates, with 67 percent of the total number of petrol stations in the country; it has the largest market share in the wholesale fuel business; and it is the biggest supplier of fuel to commercial, industrial and government customers throughout the UAE, providing refueling facilities at seven airports.
So, in addition to being a convenience-store operator, it is a beast of an industrial group, generating profits of 1.6 billion dirhams ($435 million) in the first nine months of this year. That sort of return looks certain to generate substantial interest from regional and international investors when the book-building process starts in a few weeks’ time, ahead of an ADX opening in December.
What will also attract investors is the “consistent and progressive” dividend policy the ITF document also details. ADNOC Distribution will pay at least $400 million in dividends, as well as a one-off special payment of $200 million next April. It will pay no less in 2019, and thereafter is pledging a minimum 60 percent of profits each year.
That level of shareholder payout will come from operations boosted by new and better services at the convenience stores and the petrol pump, as well as expanding into new geographies. The potential of Saudi Arabia, the region’s biggest economy, was mentioned by one adviser yesterday.
ADNOC can also leverage up its dominant position in corporate, government and aviation fuel deals.
All that commercial muscle and financial generosity could value the IPO at $800 million, and the parent company (100 percent owned by ADNOC) at $8 billion. These are staggering sums, and a real boost both for the ADX and Abu Dhabi’s economic diversification strategy, which could lead to further big IPOs in the UAE.But to suggest, as some analysts did yesterday, that the ADNOC Distribution IPO gives us a pointer for the forthcoming record-breaking issue by Saudi Aramco is surely wide of the mark.
The ADNOC flotation is very much a segment of the downstream business, whereas with Aramco the stated intention is to sell a 5 percent stake of the whole company, the biggest oil producer in the world, for $100 billion, valuing it at $2 trillion — roughly three times the gross domestic product of the entire UAE.
Aramco has enormous refineries, petrochemicals plants and research and development facilities in the Kingdom and around the world, but so far has not bothered much with petrol stations or convenience stores. Maybe it’s a revenue stream awaiting development?
Pit stops equal profit in ADNOC listing — but it’s no pointer for Aramco
Pit stops equal profit in ADNOC listing — but it’s no pointer for Aramco
Apparel Group expands Saudi presence with 25 new brands
RIYADH: Apparel Group is seeking to strengthen its presence in the Saudi market through digital commerce expansion, adding 25 new brands to its portfolio, and plans to grow its store network by 200 outlets this year to reach a total of 1,000, CEO Neeraj Teckchandani told Al-Eqtisadiah.
He noted that Saudi Arabia has been one of the group’s key markets since entering in 2007, currently operating more than 800 stores across the Kingdom. He added that the group’s current expansion plans include opening over 200 new stores this year, following 150 openings last year, with expectations that Saudi Arabia will become the group’s largest market in terms of footprint and revenue share in the coming period.
Teckchandani added that the group continues to invest in e-commerce through its digital platform, SixFeet, launched in 2016, which contributed 10 percent of total group sales, noting that plans are underway to gradually increase this share in 2026 through technology investments and enhanced digital shopping experiences.
The group is also preparing to launch a unified SuperApp this year, integrating its loyalty program, the SixFeet platform, and all digital assets into a single application to accelerate e-commerce growth, improve customer experience, and increase operational efficiency.
New fashion and restaurant brands
The CEO said the new brands added to the group’s portfolio cover fashion, footwear, restaurants, and entertainment, including Footasylum, FitFlop, and Clarins, as well as Bobbi Brown, Wagamama, Ivy Asia, and Punjab Grill.
He noted that some brands have already opened in Saudi Arabia, with further expansion planned this year and next.
85 brands under the group
Apparel Group manages 85 global brands and over 2,500 stores across Saudi Arabia, the UAE, Bahrain, Qatar, and Oman.
The company has also expanded strategically into India, South Africa, Singapore, and Indonesia, as well as Thailand, Malaysia, and Egypt.
Its portfolio includes internationally renowned fashion, footwear, and lifestyle brands such as Tommy Hilfiger, Charles & Keith, Skechers, Aldo, Crocs, Calvin Klein and Aéropostale. The group also operates food and lifestyle brands including Tim Hortons, Jamie’s Italian, and Cold Stone Creamery, alongside beauty labels such as Inglot and Rituals. R&B, its in-house label, is currently the fastest-growing brand in the region.
Securing locations in new centers
Teckchandani pointed out that the Saudi market is witnessing rapid expansion in the shopping mall sector, with 30 new centers expected to open by 2030, affirming that the group has secured strategic locations in several of these projects and aims to expand its store network in parallel with real estate growth in the retail sector.
He added that the group has also invested in operational infrastructure within Saudi Arabia, establishing a main distribution center in Riyadh to support supply chains, relocating to its new regional headquarters in Majdoul Tower, and expanding its logistics arm, “Connect Logistics,” as well as “Shopfit Interior,” a company specializing in store fit-outs.
He added that the parent company is prioritizing investment in advanced technology and AI, along with launching the unified SuperApp in the second quarter of 2026, and has appointed a group-level chief digital officer to support this phase, with results expected in the short to medium term.
Saudi expansion drives growth
Teckchandani emphasized that Saudi Arabia represents the group’s main growth engine in the coming years, supported by strong consumer demand, rapid development of shopping centers, and increasing contribution from digital commerce.
Apparel Group’s expansion comes amid a broader retail sector boom in Saudi Arabia, driven by rising consumer spending and accelerated development of malls under Vision 2030.
The retail sector is one of the largest non-oil contributors to GDP, with increasing growth in digital sales channels as companies integrate e-commerce with traditional stores to enhance operational efficiency and expand market share.
Major retailers are seeking to capitalize on population growth and rising purchasing power, alongside the expansion of hospitality and entertainment projects, boosting demand for global brands. Investments in logistics infrastructure and digital transformation have also become critical competitive factors, especially as e-commerce accounts for a growing share of total retail sales.
