ADNOC Distribution enters into an agreement to acquire Shell Downstream South Africa

On Tuesday, ADNOC Distribution announced it has entered into a definitive agreement to acquire 100% of the share capital of Shell Downstream South Africa (SDSA) from Shell South Africa Holdings (the Proposed Acquisition).

The Proposed Acquisition has an implied enterprise value of approximately $1 billion for 100% of the share capital prior to adjustment for net debt and working capital, and is expected to close in 2027, subject to customary regulatory conditions, other conditions precedent and closing conditions.

A 28% stake in SDSA is expected to be sold on to a local empowerment partner and an Employee Stock Option Plan (ESOP) following completion of the Proposed Acquisition.

ADNOC Distribution will enter into a long-term brand licensing agreement upon completion of the Proposed Acquisition to retain the Shell brand for retail service stations and lubricants businesses in South Africa.

Upon completion, customers will continue to receive their preferred and trusted experience under ADNOC Distribution’s stewardship.

CEO Commentary

Eng. Bader Saeed Al Lamki, CEO of ADNOC Distribution, said that the Proposed Acquisition marks a significant milestone in ADNOC Distribution's international growth strategy and reflects the company’s confidence in South Africa's high-potential, well-regulated fuel retail sector.

“Shell Downstream South Africa is a respected and financially strong business with deep roots in the local economy, and its values and ambitions align closely with our own. By bringing it into the ADNOC Distribution family, we plan to accelerate our international expansion, diversify our platform and create sustainable long-term value for our shareholders, our partners and the customers and communities that this business has proudly served for decades,” he added.

About Shell Downstream South Africa

SDSA represents Shell’s downstream business in South Africa, including a network of 580 company- and dealer-owned mobility and convenience sites, as well as lubricants, commercial fuels, aviation, and marine businesses.

The brand had fuel volumes of approximately 3.5 billion litres and operated 360 convenience stores as of 2025.

For more information about SDSA, please visit: https://www.shell.co.za.

South African Market Opportunity

The South African fuel retail sector offers attractive fundamentals.

South Africa’s investments in critical transport infrastructure, alongside a growing driving-age population, reinforce the growth potential of fuel consumption.

The country benefits from a strong and transparent regulatory framework for fuel retail, with pricing structures designed to insulate margins against inflation and currency volatility.

Together, these characteristics create a compelling environment for sustainable growth, consistent performance and cash generation, supporting long-term value creation for shareholders.

Commitment to South Africa

ADNOC Distribution is committed to contributing to South Africa’s strategic economic priorities following the completion of the Proposed Acquisition and the subsequent sell-down to a local empowerment partner, with a focus on energy security, job creation and inclusive economic participation priorities through the local partner.

The company will seek to appoint a partner with a deep understanding of the South African sector, its regulatory environment and local operating requirements, including alignment with the objectives of the country’s Broad-Based Black Economic Empowerment (B-BBEE) legislation.

Transaction Benefits

The Proposed Acquisition is expected to be value-accretive to ADNOC Distribution, bolstering its earnings per share by 6% in the first full year after completion, and is projected to generate an IRR in excess of the hurdle rate for the company’s fuel and convenience retail business.

Upon closing, the Proposed Acquisition would mark a key milestone in ADNOC Distribution’s international growth strategy towards building a stronger fuel retail presence in Africa.

South Africa represents the fourth country where ADNOC Distribution would operate and follows its acquisition of a 50% stake in TotalEnergies Marketing Egypt in 2023 and the 2018 launch of its retail fuel stations in Saudi Arabia.

Transaction Advisors

BofA Securities acted as the sole financial advisor.

A&O Shearman and ENS provided legal counsel to ADNOC Distribution on the transaction.