State-run energy firm Adnoc is reportedly weighing IPOs for its newly set up USD 80 bn renewables and chemicals arm XRG and its JV with Presight, AIQ, according to reports over the weekend.

The company is reportedly looking at listing XRG on an international exchange, Reuters reports, citing people it says have knowledge of the matter. The minority stake sale is expected to materialize in about five years with New York and London among the potential listing venues, the people said. The London Stock Exchange (LSE), on which stocks of major oil and gas players like Shell and BP are currently trading, is a strong contender for XRG’s potential IPO despite recent outflows from the exchange, one person told Reuters. Meanwhile, a listing on the New York Stock Exchange (NYSE) could fetch a higher valuation for XRG, making it a more attractive option.

The move could make XRG one of largest publicly traded energy firms in the world, according to the newswire.

Adnoc has been churning out IPOs for its subsidiaries since late 2017, starting with its fuel retail arm’s USD 851 mn ADX debut. Since 2021, it has taken Adnoc Drilling, Fertiglobe, Adnoc Gas, Adnoc Logistics & Services (which was recently upgraded to the FTSE Large Cap Index) and Borouge to the ADX, in some of the country’s largest IPOs. Combined, these transactions drummed up more capital than Saudi Aramco’s record-breaking Tadawul IPO in 2019, excluding the USD 12 bn it raised in a follow-on offering last year, according to Reuters calculations.

Adnoc founded XRG in November 2024 with the aim of investing in lower-carbon energy and chemicals as part of a broader plan to diversify the company’s portfolio and reduce its reliance on oil revenue. The energy giant is prepping XRG to become one of the world’s top five chemical producers and capture 70% of global demand by 2050. Its portfolio already includes a majority stake in Germany’s Covestro and Borouge International. XRG’s board includes former BP chief Bernard Looney, Blackstone President and COO Jon Gray, and Egyptian bn’aire Nassef Sawiris.

But first… restructuring: Adnoc will still need to name a CEO and complete the transfer of assets to XRG before pursuing a public debut, the people said. The company, which was set up late last year, is due to become operational this quarter with plans to double its USD 80 bn asset value over the next decade. Just last week, Adnoc announced plans to transfer its stake in Borouge International, a newly-merged polyolefins giant, to XRG, cementing its role as a primary vehicle for the state-run energy firm’s international expansion into the chemicals industry.

ADVISORS- Bank of America is said to be advising on XRG’s strategy.

IN OTHER IPO NEWS-

Adnoc and ADX-listed data analytics firm Presight AI Holding are sounding out banks for roles on the potential IPO of their artificial intelligence JV, AIQ, Bloomberg reports, citing people it says are familiar with the matter. The pair are considering reviving earlier plans to take AIQ public as soon as this year, the people said. Though no details on the potential size or specific timing of the offering were disclosed, it would likely take place on the ADX.

About AIQ: Founded in 2020 with G42, AIQ has built over 20 AI applications and filed 16 patents with Adnoc, as its primary customer, deploying these tools to speed up seismic surveys from months to days and streamline planning for field development and drilling, CEO Sultan Al Jaber tells Bloomberg, while also cutting emissions and improving safety. AIQ is also currently working with Microsoft and G42 to develop AI software for the energy sector, using agentic AI to process vast datasets.

IN CONTEXT- This comes amid a surge of interest in AI and tech stocks in the country. IT services provider Alpha Data, which is set to hit the ADX tomorrow in the exchange’s first IPO of the year, priced its offering at the top of the range with strong investor appetite pushing the company’s implied valuation up to AED 1.5 bn at listing.

It’s a tight-knit circle: Presight bought a 51% stake in AIQ from its Mubadala-backed parent company G42 in May of last year in a transaction that valued the JV at USD 1.4 bn. The move saw Adnoc retain the remaining 49% stake in AIQ in addition to securing a 4% interest in Presight.

WE HAVE A STRONG IPO PIPELINE-

  • ADQ-backed Etihad Airways is expected to kick off the region’s first IPO of a major airline in nearly a decade after Eid Al Fitr;
  • Abu Dhabi conglomerate International Holding Company’s investment arm 2PointZero is gearing up for an IPO on the ADX;
  • Alec Construction and Arabian Construction are both eyeing IPOs;
  • Dubai Holding plans to float two of its property portfolio units, and Sharjah-born Arada’sis also eyeing anIPO in three years’ time;
  • Abu Dhabi Investment Group (ADIG) is eyeing listings for its financial unit and energy subsidiary this year;
  • Dubizzle Group tapped banks for a 2025 IPO on the Dubai Financial Market (DFM);
  • Hospitality group Five Holdings also tapped advisors for a potential listing;
  • Amanat Holdings is planning to list its education and healthcare units;
  • Shisha producer Advanced Inhalation Ritual is also rumored to potentially IPO.
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