Abu Dhabi chemicals JV: what ADQ is and what it brings to joint venture with Adnoc

The company owns stakes in many of Abu Dhabi's key industrial and infrastructure assets including Emirates Steel, Abu Dhabi Ports and Etihad Rail

Until March this year, ADQ was known as Abu Dhabi Developmental Holding Company and it served as a holding company for government stakes in 11 companies. This was expanded to 25 as part of a shake-up that included its rebrand.

The company was founded just two years ago, but its portfolio of assets has existed for a lot longer. These include Abu Dhabi Airports, Abu Dhabi Ports, Etihad Rail, the power and water utility Taqa, Emirates Steel, Al Gharbia Pipe Company and contracting company NPCC. It also owns Abu Dhabi General Services Company, Musanada, which is responsible for developing much of the emirate’s public infrastructure such as roads and housing. National Marine Dredging Company and building materials supplier Arkan Building Materials are also under ADQ's banner.

These companies provide investors in Ruwais with the knowledge that critical infrastructure for chemicals manufacturing will be in place via its joint venture with Adnoc.

As well as the hard assets, its portfolio includes other businesses that would be of use to inward investors. Since its expansion in March, it also owns stock market operator Abu Dhabi Securities Exchange, health services company Seha, medical insurer Daman, Abu Dhabi National Exhibitions Company, Emirates Driving Company, food group Agthia, media free zone operator TwoFour54 and Abu Dhabi Media Company.

Other holdings include a group of tourism assets; the Qasr Al Sarab, Anantara Al Sahel, Anantara Al Yamm and Desert Islands resorts, as well as Qaryat Al Berri Resort Development Company and Emirates Pearl for Development and Investment.

ADQ’s mission is to act “as a national champion on behalf of the government to maximise the performance and value creation by each of our portfolio companies”, the company’s chief executive, Mohamed Alsuwaidi said at the time of the rebrand and expansion in March.

"Each portfolio company has built its own powerful place in society and regional markets. We do not seek to change that, but to enhance it,” Mr Alsuwaidi said.

The company’s primary goal is to encourage sustainable wealth generation to make sure the emirate’s prosperity is passed down to future generations.

“In practice, we aim to enable [portfolio companies] through collaboration to achieve excellence in terms of higher productivity, efficiency and quality that will help promote their operations and their business success in increasingly competitive markets at home and abroad,” Mr Alsuwaidi said.

This drive for greater efficiency has already sparked some reorganisation within its portfolio, including the reverse takeover of Taqa by Abu Dhabi Power Corporation, creating the UAE’s third-largest publicly-traded company and one of the top 10 largest integrated utility companies in the Europe, Middle East and Africa region, with Dh200 billion of assets.

Last week, it was also announced that two more ADQ companies would merge. ZonesCorp, the operator of large industrial city complexes in Abu Dhabi and Al Ain, is becoming part of Abu Dhabi Ports Company, operator of the Khalifa Industrial Zone. The merged entity will have a land area of 554 square kilometres and more than 1,400 customers.

The company also recently launched a Dh1.1bn fund targeting Indian and South East Asian businesses, with a view to encouraging them to set up operations at Masdar City in Abu Dhabi.

The Alpha Wave Incubation (AWI) Fund will be based in Abu Dhabi Global Market and be managed by New York-based Falcon Edge Capital.

It also bought a 50 per cent stake in animal feed and food commodities company Al Dhahra Holding to expand its portfolio of food and agriculture businesses.