Abu Dhabi's government-controlled National Petroleum Construction Company and National Marine Dredging Company are consolidating in a turnaround acquisition to form an oil, gas and marine company.
NPCC will move all its shares to NMDC via NPCC parent Abu Dhabi Developmental Holding Company, or ADQ, it said Sunday. The consolidation will create a "national champion" with combined sales of nearly $2.5 billion in 2019, according to a statement.
The deal will pave the way for a more diversified and financially robust entity, ADQ chief investment officer Khalifa Suwaidi said. Suwaidi is also chairman of Senaat General Holding Corporation which is operated by ADQ and is NPCC's biggest stockholder.
The deal will rationalize ownership. ADQ has substantial investment in the two groups. ADQ also has a large stake in Abu Dhabi stock exchange-listed NMDC and controls NPCC through Abu Dhabi General Holdings Corporation.
NPCC is an international engineering and infrastructure development consortium that services the onshore and offshore oil-and-gas sector.
As part of the deal NPCC shareholders will get preferred shares or bonds that, when converted, will give them nearly 68 percent, or 575 million ordinary shares, in the consolidated business.
Abu Dhabi has large oil reserves but has recently combined a number of companies as it looks to boost its economy and diversify from oil and gas. Abu Dhabi earlier merged power companies Abu Dhabi Power Corporation and Abu Dhabi National Energy Co. PJSC, or TAQA.
ADQ owns more than 90 companies across 11 sectors of the United Arab Emirates including Etihad Rail, Emirates Steel, Abu Dhabi Ports and Abu Dhabi Airports, according to its website.
