Fertiglobe Surges 20% in Abu Dhabi Debut After $795 Million IPO

(Bloomberg) --

Fertiglobe Holdings, the fertilizer maker backed by U.S. hedge fund investor Jeff Ubben and a Singapore wealth fund, jumped 20% on its trading debut following a $795 million initial public offering.

The shares opened at 3.06 dirhams on Wednesday in Abu Dhabi. State-controlled Abu Dhabi National Oil Co. and OCI NV had sold just under 14% of Fertiglobe at 2.55 dirhams per share, valuing the company at $5.8 billion.

Fertiglobe’s listing is the emirate’s third largest. Singapore sovereign wealth fund GIC Pte and Ubben’s Inclusive Capital Partners committed $150 million between them to the deal. 

The IPO is the latest in a series of heavily-oversubscribed listings in the United Arab Emirates and neighboring Saudi Arabia. A surge in oil prices has boosted both economies and liquidity on their equity markets.

Earlier in October, Adnoc’s drilling unit rose about 30% on its trading debut after a $1.1 billion IPO. In Riyadh, utility ACWA Power International got more than $300 billion of orders for a $1.2 billion listing.

Europe Boost

Fertiglobe is an important part of Abu Dhabi’s efforts to export hydrogen, a fuel seen as crucial to the global transition away from coal and oil. It operates four fertilizer and chemical plants in the UAE, Egypt and Algeria. 

Its earnings have boomed this year amid a commodities rally driven by the recovery of major economies from the coronavirus pandemic. In recent weeks, the company has been seen sales to Europe climb due to a gas crisis that’s forced some rivals there to cut production.

The company reported revenue of $1.55 billion in 2020 and $1.26 billion for the first six months of 2021. This month, it raised dividend guidance for the second half of the year to $200 million from $150 million.

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