(MENAFN - Emirates News Agency (WAM)) ABU DHABI, 31st December, 2020 (WAM) -- ADNOC Distribution on Thursday announced the execution of a definitive agreement to acquire 15 service stations in Saudi Arabia, reaffirming its commitment to grow its business in the Kingdom; the largest fuel retail market in the GCC.
The purchase consideration for this acquisition is AED36.7 million (US$10 million). The acquisition is subject to certain conditions (including obtaining regulatory approvals).
Already the only fuel retailer operating in all seven emirates in the UAE, the addition of these new stations highlights the long term smart growth strategy to also become a leading fuel operator in Saudi Arabia.
The company sees value creation potential coming from uplift in fuel margins and the company's integrated approach to managing fuel and non-fuel retail offerings.
Located in the eastern region, with sites dedicated to both highway commuters as well as in-community convenience, the new stations will be refurbished in line with ADNOC Distribution brand standards and offer high quality fuel and retail services to customers, including convenience stores; "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," Ahmed Al Shamsi, Acting CEO of ADNOC Distribution, said.
ADNOC Distribution opened its first service station in Saudi Arabia in December 2018, located on the Riyadh-Dammam highway around 40 kilometres 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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