The board of the Abu Dhabi National Energy Company (TAQA) has approved the sale and purchase of an asset swap deal with the Abu Dhabi Power Corporation (ADPower).
The proposed transaction would create a new regional utilities champion that will accelerate the transformation of the water and electricity industry in the UAE.
The new entity would be one of the largest utility companies in the GCC and a top 10 integrated utilities player in the EMEA region by regulated assets, ADPower had said in a statement.
TAQA’s board has also approved the issuance of a mandatory convertible bond to ADPower for the planned deal, it said in a statement to the Abu Dhabi Securities Exchange.
It has also recommended its shareholders to approve the deal at the annual general assembly due to be held on April 29.
As part of the deal, TAQA will issue 106.3 billion shares to ADPower. Once the deal is executed, AD Power will own 98.6 per cent of Taqa's entire share capital.
In the first week of Februrary, ADPower, that owns most of the water and electricity assets across Abu Dhabi, offered to transfer the majority of its water and electricity generation, transmission and distribution assets to TAQA. The assets, worth 120 billion dirhams as of the end of 2018, together reported a net income of 4.8 billion dirhams.
As of December 31, 2019, TAQA’s accumulated losses stand at 1.64 billion dirhams.
(Writing by Seban Scaria; editing by Daniel Luiz)
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