GulfNav seals its long-pending AED 3.2 bn play for Brooge

GulfNav closed its AED 3.2 bn takeover of all of Nasdaq-listed Brooge Energy’s assets, in a long-delayed transaction that extends the DFM-listed shipowner’s footprint in midstream energy infrastructure, according to a bourse disclosure (pdf) published last week. The move, originally due for completion in 2Q, gives GulfNav full control of Brooge’s storage and blending assets in Fujairah, one of the region’s key oil logistics hubs, effectively integrating storage capacity into its wider maritime logistics platform.

How we got here: GulfNav settled the transaction through a capital increase which lifted its paid-up capital by some 220% to around AED 1.7 bn. The structure included fresh equity issued to Brooge shareholders through AED 2.3 bn in mandatory convertible bonds (MCB), an AED 500 mn MCB tranche taken up by existing shareholders, and AED 460 mn in banknotes.

This puts GulfNav on course for a projected paid-up capital of about AED 3.5 bn once all bonds convert.

Leaning further up the energy chain: Post-acquisition, the group plans to expand into refining, renewables, and clean fuels and energy infrastructure projects, while continuing to grow its core shipping and logistics operations, the release says.

Also in the pipeline: Brooge is advancing plans for a 15k bbl / d gasoline refinery in Fujairah — announced earlier this month — under an agreement with Honeywell. The project’s first phase is set to use advanced refining and processing technologies, adding a downstream component to the asset base GulfNav is taking over.

ADVISORS- GulfNav appointed Trussbridge Advisory as its exclusive financial advisor, and Pinsent Masons as lead counsel. Law firm Ibrahim & Partners provided advice on transaction structuring and related regulatory aspects.