ADNOC Distribution signed a definitive agreement on 7 July to buy Shell Downstream South Africa from Shell South Africa Holdings, implying an enterprise value of about US$1bn for the whole business.
Why ADNOC Distribution is buying Shell Downstream South Africa
ADNOC Distribution said the deal is a significant milestone in its international growth strategy and is expected to add 6% to earnings per share in the first full year after completion. South Africa would become its fourth operating country after the UAE, Saudi Arabia and Egypt.
“Shell Downstream South Africa is a respected and financially strong business”
Deal terms and financing
The price is for 100% of SDSA's share capital and is subject to net debt and working capital adjustments. After completion, ADNOC Distribution expects to sell 28% to a local empowerment partner aligned with B-BBEE objectives and to an employee share ownership plan, and it will sign a long-term licence to keep using the Shell brand for retail and lubricants.
Regulatory approvals and timing
Completion is expected in 2027, subject to regulatory approvals and other conditions.
Market context
SDSA operates about 580 company- and dealer-owned sites and 360 convenience stores and supplies aviation fuel, lubricants, commercial and marine fuels. For Shell, the sale is part of a drive to simplify its downstream business and focus on its highest-return operations.
