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ADNOC/Alpha Dhabi JV Enersol to become majority stakeholder in Gordon Technologies

ADNOC and Alpha Dhabi’s Enersol joint venture has announced plans to acquire an additional 42.206% equity stake in Gordon Technologies for $270 million. This move will solidify Enersol’s position as the majority equity holder. The consideration is based on a valuation in line with the one underpinning the initial 25% stake purchase announced in January 2024.

Assuming all necessary regulatory clearances are met, Enersol intends to invest in or buy a number of companies. A key factor in investment decisions is the potential contribution to the UAE’s larger goals of energy security, net zero agenda and continuous economic diversification.

Gordon is a provider of MWD technology to the oil and gas industry. The company completed setting up its Abu Dhabi business with the intention to start field operations in the MENA region in Q2 2024.

Approximately 80% of the consideration for the 42.206% additional stake acquired by Enersol will be funded upon closing. The remaining part of the consideration is expected to be paid in the next two years, subject to certain performance conditions. Standard regulatory clearances and closing adjustments must be satisfied before the transaction can close.

The acquisition of Gordon, which is debt-free, will be economically beneficial to Enersol in many ways, including increased profitability, a higher valuation multiple, more cash flow, the possibility of dividends, and a free cash flow yield of over 10% in FY2023.

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