GIP, Snam Said to Mull Exit From $21 Billion Adnoc Gas Pipe Unit

(Bloomberg) -- Global Infrastructure Partners and Italy’s Snam SpA are considering a potential sale of their stakes in Abu Dhabi National Oil Co.’s gas pipeline unit, according to people familiar with the matter.

GIP, the biggest foreign shareholder in Adnoc Gas Pipeline Assets LLC, is working with advisers as it prepares to gauge interest in the holding, the people said. Snam, an Italian gas network operator that owns about 6%, has also been weighing an exit, according to the people. 

Abu Dhabi investment firm Lunate has reached out to some of Adnoc Gas Pipeline’s key owners to express interest in buying their stakes, the people said. Some of the investors are still deliberating whether to sell their holdings or keep them for longer, the people said, asking not to be identified discussing private information. 

GIP led a group of foreign buyers that agreed in 2020 to invest in the pipeline network at a valuation of nearly $21 billion including debt. The consortium — which also included Brookfield Asset Management, Singapore sovereign wealth fund GIC Pte, Ontario Teachers’ Pension Plan and South Korea’s NH Investment & Securities Co. — bought a 49% stake for about $10.1 billion.

Under the terms of that agreement, the international partners gained an interest in the pipeline assets through a new subsidiary, Adnoc Gas Pipeline, for 20 years with guaranteed minimum returns. Abu Dhabi has also added some local funds into the ownership structure.

Lunate was set up by an arm of Sheikh Tahnoon bin Zayed Al Nahyan’s listed conglomerate, International Holding Co., and is backed by investors including Abu Dhabi wealth fund ADQ. The firm, which manages about $105 billion, agreed earlier this year to buy a 40% stake in Adnoc’s oil pipeline network from BlackRock Inc. and KKR & Co.

Deliberations are ongoing, and there’s no certainty they will result in a transaction, the people said. Representatives for Adnoc, GIP, Lunate and Snam declined to comment. 

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