UAE's ADNOC Selects Reatile as Partner for $1 Billion Shell South Africa Acquisition

en.Wedoany.com Reported - On August 25, South Africa's Reatile Group confirmed the signing of a long-term cooperation agreement with ADNOC Distribution, under which it will serve as the local partner in the latter's proposed acquisition of Shell Downstream South Africa. Upon completion of the main acquisition, Reatile will acquire a minority stake in the target company, with the specific shareholding percentage and investment amount yet to be disclosed.

ADNOC Distribution had already signed a definitive agreement with Shell South Africa Holdings on July 7 to acquire all shares of Shell Downstream South Africa. The implied enterprise value of the target is approximately $1 billion, with the transaction price subject to adjustments based on net debt and working capital.

Upon completion of the transaction, ADNOC Distribution plans to allocate a combined 28% equity stake to local empowerment partners and employee share schemes in South Africa, with an expected retained majority stake of 72%. Reatile's specific share within that 28% has not yet been determined, and its participation arrangement is aligned with South Africa's Broad-Based Black Economic Empowerment framework.

The acquired assets include approximately 580 company-owned and dealer-operated service stations and integrated service sites, 360 convenience stores, as well as commercial and wholesale fuel, aviation fuel, marine fuel, and lubricants businesses. The network sold approximately 3.5 billion liters of fuel in 2025, making it one of the larger fuel retail platforms in South Africa.

Following completion of the main transaction, the service station and lubricants businesses will continue to use the Shell brand under a long-term brand licensing agreement. ADNOC Distribution expects the asset to increase the company's earnings per share by approximately 6% and EBITDA by approximately 13% in the first full year following closing.

The acquisition remains subject to regulatory approvals and other closing conditions, with completion expected in 2027. Reatile's minority stake arrangement will be implemented after the closing of the main acquisition, and existing Shell Downstream South Africa employees will continue to be absorbed under the new shareholder structure.