Abu Dhabi, UAE – ADNOC Distribution announced the conclusion of a final agreement with Shell South Africa Holding. To acquire the entire capital of Shell Downstream South Africa, this deal is referred to as the “Proposed Acquisition”.
The estimated value of the company under the proposed acquisition is $1 billion, based on the acquisition of 100% of the capital. This is before calculating net debt and working capital adjustments. The proposed deal is expected to be completed during 2027, after meeting regulatory approvals and the usual closing conditions.
Following the completion of the proposed deal, a 28% stake in Shell Downstream South Africa is expected to be sold to a local partner. As required by South Africa’s comprehensive economic empowerment legislation.
Trademark License Agreement
Following completion of the proposed acquisition, ADNOC Distribution will enter into a licensing agreement for long-term use of the brand. It allows it to continue operating service stations and lubricant businesses in South Africa under the Shell brand.
Upon completion of the transaction, customers will continue to benefit from the preferred and reliable experience they are accustomed to. Under the supervision of ADNOC Distribution.
Shell Downstream South Africa represents Shell’s marketing and distribution business in South Africa. Its business portfolio includes a network of approximately 580 gas stations, owned by the company or managed through authorized dealers.
Its operational operations extend to lubricants, commercial fuels, and aviation and ship fuels. According to 2025 data. The company’s fuel sales amounted to approximately 3.5 billion liters, and it operates 360 retail stores.
Well-established and attractive foundations
South Africa’s retail fuel distribution sector has solid and attractive foundations, supported by strong investments in critical transportation infrastructure. Along with the continued growth of the driving-age population base, this enhances the long-term prospects for fuel demand.
South Africa’s business system also benefits from a strong and transparent regulatory framework for the retail fuel distribution sector. And pricing structures designed to protect profit margins from inflation and exchange rate fluctuations. Together, these factors contribute to creating an operational environment that supports sustainable growth and outstanding performance. Enhancing the ability to generate strong cash flows, supporting the creation of long-term value for shareholders.
Following the completion of the proposed acquisition deal and the completion of the sale of a minority stake to a local partner, ADNOC Distribution affirmed its commitment to contributing to supporting South Africa’s economic and strategic priorities. With a focus on enhancing its role in ensuring energy security and creating job opportunities. Expanding comprehensive economic participation through the local partner. The company will also work to select a partner with a deep understanding of the South African market and its regulatory framework. And local operating requirements, ensuring compatibility with the objectives of comprehensive economic empowerment legislation.
enhancing value
The proposed acquisition is expected to support the creation and enhancement of value for ADNOC Distribution, by contributing to an increase in earnings per share of approximately 6% during the first fiscal year of its completion. In addition to achieving an internal rate of return that exceeds the minimum target for the company’s business in the fuel distribution and retail sectors.
The proposed acquisition, upon completion, will mark a milestone in ADNOC Distribution’s international expansion strategy. To enhance its presence in the fuel distribution sector in Africa.
South Africa will be the fourth market in which ADNOC Distribution begins operations. It is an extension of its expansion efforts, which included the acquisition of a 50% stake in Total Energies Marketing Egypt LLC.M.M.” 2023. It opened its first stations outside the UAE in the Kingdom of Saudi Arabia in 2018.
BofA Securities served as the exclusive financial advisor for the deal. A&O Sherman and Ince also provided relevant legal advice to ADNOC Distribution.
