Abu Dhabi sovereign wealth fund ADQ plans to acquire up to 100 percent of the issued and paid-up share capital of Aramex not already held by Abu Dhabi Ports Company PJSC.
According to a bourse filing on Monday, Q Logistics Holding, a wholly-owned indirect subsidiary of ADQ, will launch a cash offer at a price of AED3 ($0.82) per share, a premium of around 30 percent to Dubai-listed Aramex’s closing price on Friday of AED2.31 per share.
Shares in Aramex opened up 14.7 percent higher at AED2.65 per share on Monday.
ADQ seeks logistics unit expansion
Headquartered in the UAE and listed on the Dubai Financial Market (DFM), Aramex operates in 600+ cities across 70 countries. The company provides logistics and transportation services including domestic and international express delivery by road, air and sea.
ADQ has a wide portfolio of domestic assets, including Etihad Airways and Abu Dhabi Ports Company, through which it holds a 22.69 percent stake in Aramex.
With this acquisition, ADQ aims to expand its footprint in critical infrastructure and supply chains. The wealth fund operates in key economic sectors including energy and utilities, transport and logistics, agriculture, and healthcare and life sciences. Through the takeover of Aramex, ADQ also seeks to achieve its target of developing the robustness and resilience of core sectors in the UAE’s economy.
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Aramex to undergo transformation
According to the filing, AQD believes that Aramex needs a “strategic and operational transformation” to unlock the company’s full potential and restore financial stability. The filing added that Aramex’s financial results have been declining since 2019. In addition, the company did not announce dividends in 2023, suggesting a lack of current returns for shareholders.
As of Monday, “there are no arrangements entered into between Q Logistics Holding and Aramex”, ADQ’s unit said in the statement, without providing a timeline for the offer.
Rothschild is acting as Q Logistics Holding’s financial adviser while Emirates NBD capital is the lead manager.
