ADWEA prepares to distribute stakes

22 August 2003
A small number of international banks have been sounded out by Abu Dhabi Water & Electricity Authority (ADWEA) about their interest in acting as a financial adviser on the potential sell-down of ADWEA's stakes in the emirate's two distribution companies.

'We've been asked to indicate by the end of August whether we might be interested in bidding,' says an international banker. 'If we are, bids are due to go in about two weeks later. There is not a lot of detail in the document we have received.'

Bankers say they believe ADWEA's intention is to sell significant minority stakes in the equity of the two distribution companies - Al-Ain Distribution Company (AADC)and Abu Dhabi Distribution Company (ADDC)- in either a private placement or an initial public offering (IPO) to UAE nationals. AADC and ADDC, currently unlisted public joint-stock companies, might subsequently be listed on the Abu Dhabi Stock Market (ADSM).

However, ADWEA chairman Sheikh Diab told MEED in a July interview that ADWEA was 'studying very carefully how we can bring private investors into distribution. Our aim is to have a relationship with a foreign company' (MEED 18:7:03, Cover Story).

Any decision to sell down ADWEA's stakes in the companies is likely to coincide with the completion of Abu Dhabi's electricity grid - due by the end of the year - and its water network, due in 2004.

Both AADC and ADDC were formed on 1 January 1999 and are responsible for the distribution and sale of water and electricity in different parts of Abu Dhabi emirate. The former has over 100,000 customers and the latter has more than 200,000.

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