Abu Dhabi, United Arab Emirates, and Paris, France: Mubadala Investment Company (Mubadala), the Abu Dhabi-based strategic investment company, has agreed to sell a 40% stake in National Central Cooling Company PJSC (DFM: Tabreed) to ENGIE, a worldwide energy leader.
As part of the transaction, Mubadala which currently owns approximately 82% of Tabreed (on a fully diluted basis, through a combination of equity and mandatory convertible bonds (MCBs)), will be converting all its MCBs into shares, with 1,086,211,654 shares (equivalent to a 40% shareholding in Tabreed) being transferred to ENGIE at a price of approximately AED 2.62 per share. Mubadala will retain 1,136,507,713 million shares taking its total shareholding in Tabreed to approximately 42%.
Mubadala will remain Tabreed’s single largest shareholder following the transaction, which is subject to regulatory approval in the UAE. Completion is expected to occur in the third quarter of 2017. Mubadala and ENGIE have also agreed certain cooperation arrangements that are designed to support Tabreed's growth strategy and management team, as long term shareholders in the company.
“Tabreed is a company with a strong growth trajectory, and will benefit from ENGIE’s experience as an operator of world-class utility businesses”, said Homaid Al Shimmari, Deputy Group CEO of Mubadala. “Mubadala has been, and will continue to be, a significant, long-standing shareholder in Tabreed. Tabreed is a well-capitalized company delivering consistent and sustainable returns to investors, with a strong and growing customer base.”
Sebastien Arbola, Chief Executive Officer of ENGIE Middle East, South and Central Asia, Turkey, said: “With 30 years of experience in the region, ENGIE has become the lead IWPP there. ENGIE is supporting the development of low carbon power and water production as well as helping the growth of smart and sustainable cities. In that regard, district cooling networks will be at the center of this sustainable model. ENGIE will bring its longstanding experience and build on the legacy of Mubadala to foster Tabreed profitable growth”.
ENGIE is a major player in highly efficient cooling networks, that are typically 50% more energy efficient than individual cooling solutions and generate 50% less CO2. ENGIE operates more than 250 low-carbon urban heating and cooling networks in 13 countries, including some of the most emblematic European district cooling systems, in places such as the London Olympic Park, the cities of Paris, Marseille, Barcelona, Lisbon, and also worldwide with the city of Cyberjaya in Malaysia. Through the partnership with Mubadala, Tabreed will become one of ENGIE’s main regional development platform, besides existing operations in Western Europe, North America (where ENGIE was recently awarded the Ohio State University’s utility system operation and optimization) and South-East Asia. ENGIE expects to lead a rapid growth, through Tabreed, in new emerging markets like India, Egypt and Turkey.
Tabreed has steadily grown over the years to become a key player in enabling the region’s economic development. The company today provides its innovative cooling solutions to iconic infrastructure projects in the United Arab Emirates and across the Gulf Cooperation Council (GCC) countries. With over 71 district cooling plants located throughout the GCC, the company today delivers over 1 million refrigeration tons to key developments in the region. Its portfolio includes Abu Dhabi’s Al Maryah Island, Yas Island, Sheikh Zayed Grand Mosque, the Dubai Metro, Dubai Parks and Resorts, and the Jebal Omar Development Project in the Holy City of Mecca.
Mubadala and ENGIE also have a long-standing partnership as investors in SMN Power Holding Company, Oman’s largest power generation company.