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Macro

ADQ Eyes First Dollar Bond, Targets $500M Amid Global Expansion

ADQ to issue inaugural dollar bonds, revealing $30.41 billion revenue in 2023, as part of its global expansion strategy.

By Max Weldon

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4/29, 06:34 EDT
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Key Takeaway

  • Abu Dhabi's sovereign wealth fund ADQ plans its first dollar bond sale, eyeing five and 10-year maturities.
  • Follows Abu Dhabi's $5 billion eurobond issue, highlighting the emirate's active engagement in global debt markets.
  • ADQ contributes 22% to Abu Dhabi’s non-oil GDP, with diverse investments including utilities, aviation, and technology funds.

ADQ's Strategic Debut in Dollar Bond Market

Abu Dhabi's sovereign wealth fund, ADQ, is making headlines with its inaugural venture into the dollar bond market, planning to issue US dollar-denominated, benchmark size senior unsecured bonds with maturities of five and 10 years. This move is part of a broader strategy to diversify funding sources for future acquisitions. The issuance follows closely on the heels of Abu Dhabi's successful $5 billion eurobond sale, marking the emirate's first foray into the eurobond market since 2021. ADQ, a pivotal entity contributing approximately 22% to Abu Dhabi’s non-oil GDP in 2023, encompasses a diverse portfolio including Emirates Water and Electricity Company, Emirates Nuclear Energy Corporation, Etihad Airways, and Abu Dhabi Airports, among others.

Financials Unveiled Ahead of Bond Sale

For the first time, ADQ has disclosed its financials, revealing a consolidated revenue of 111.7 billion dirhams ($30.41 billion) for 2023, an increase from the previous year's 99.6 billion dirhams. Profits attributable to owners rose to 16.1 billion dirhams in 2023, up from 11.43 billion dirhams in 2022. With assets totaling 720.5 billion dirhams and liabilities at 358.5 billion dirhams, ADQ's financial health is robust. The bond sale, expected to be of benchmark size, typically at least $500 million, is coordinated by global financial giants including Citigroup Inc., Crédit Agricole CIB, and Goldman Sachs International.

Expanding Global Investments

ADQ's aggressive expansion strategy is evident in its recent activities, including exploring potential investments in Kenya worth up to $500 million and launching a $180 million technology-focused fund targeting Oman’s digital economy. These moves underscore ADQ's ambition to extend its investment footprint beyond the UAE, leveraging its financial clout to foster economic growth and diversification in the region.