ADNOC Distribution increases Saudi Arabia’s commitment with network expansion

ADNOC Distribution acquires 15 service stations in the Kingdom of Saudi Arabia reaffirming its commitment to grow its business in KSA. The Company entered the KADNOC Distribution, the largest fuel and convenience retailer in the UAE, has implemented a final agreement to acquire 15 service stations in Saudi Arabia, reaffirming its commitment to expand its business in the region

Already the only fuel retailer operating in all seven emirates in the UAE, the addition of these new stations underscores the long-term smart growth strategy of becoming KSA’s leading fuel operator. The company sees the potential for value creation as a result of the increase in fuel margins and the company’s integrated approach to managing fuel and non-fuel retail offerings.

The purchase consideration for this acquisition is US$10mn. The acquisition is subject to certain conditions (including obtaining regulatory approvals).

Located in the eastern region, with both highway and in-community convenience sites, the new stations will be renovated in line with ADNOC Distribution brand standards and will offer high-quality fuel and retail services to customers, including convenience stores; a proven unique value proposition that has made the company so successful in the UAE.

Ahmed Al Shamsi, acting CEO, ADNOC Distribution, said, “Expanding our presence in Saudi Arabia is an important milestone for our company and part of our profitable growth strategy. We see this expansion as a natural progression since opening our first station in 2018 and look forward to significantly increasing our presence in the coming years.  This is the first announcement of many we intend to make with Saudi being a key strategic market for us as we make ADNOC service stations a destination for all in Saudi.”

ADNOC Distribution opened its first service station in Saudi Arabia in December 2018, located on the Riyadh-Dammam highway around 40km from the capital. It was followed shortly after by the second in the city of Hofuf within Al Ahsa Governate. Upon completion of this transaction, the new locations will bring the company’s total network to 17 across the kingdom. 

“Saudi Arabia is the largest market in the GCC, and there is huge potential for experienced fuel operators like us to consolidate the market and capture further growth,” commented Al Shamsi. “And we are currently in discussions on a range of opportunities to further build on our network in the country. With such a vast and diverse landscape, we aim to bring our fuel and retail experience to benefit local communities and industrial areas across the kingdom.”

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