Taqa, Adnoc and Mubadala complete deal to acquire stakes in Masdar

The transaction, announced last year, will help the clean energy company to grow rapidly on a global scale in the renewable and green hydrogen sectors

Masdar City, the emirate's flagship clean energy city, will remain under sole ownership of Mubadala. Photo: Masdar City

Abu Dhabi National Energy Company, better known as Taqa, Mubadala Investment Company and Adnoc have completed a deal to become shareholders in the emirate’s flagship clean energy champion Masdar.

This transaction — announced last year by President Sheikh Mohamed — will help Masdar grow rapidly on a global scale under an expanded mandate that covers renewable power, green hydrogen and other enabling clean energy technology, the companies said in a filing to the Abu Dhabi Securities Exchange on Thursday.

“As the founding chief executive of Masdar, I am excited to see Abu Dhabi’s energy leaders coming together to take Masdar to the next level,” said Dr Sultan Al Jaber, Minister of Industry and Advanced Technology, managing director and group chief executive of Adnoc, and chairman of Masdar.

“The Masdar clean energy powerhouse will unlock a new chapter of growth, development and opportunity for renewable energy and green hydrogen projects, both in the UAE and worldwide.”

In June, the parties entered into binding agreements that allowed Taqa and Adnoc to buy Masdar stakes from Mubadala.

Taqa has acquired a 43 per cent controlling stake in Masdar’s renewables business, with Mubadala retaining a 33 per cent interest and Adnoc owning the remaining 24 per cent.

Adnoc holds a 43 per cent controlling stake in Masdar’s new green hydrogen joint venture, Mubadala retains a 33 per cent interest and Taqa controls 24 per cent.

The transaction puts the value of the new Masdar joint ventures at about Dh7 billion ($1.9 billion) on a 100 per cent equity basis, the companies said at the time.

As part of the deal, Taqa, which has paid $1.02 billion in cash for its stake, will contribute its ownership interests in future Abu Dhabi renewable power projects to Masdar.

Masdar City, the emirate’s flagship sustainable urban development, will continue to remain under Mubadala’s ownership as the sole shareholder, according to the bourse disclosure.

The partnership consolidates the renewable energy and green hydrogen efforts of Taqa, Mubadala, and Adnoc under single brand — that of Masdar.

As the UAE continues to deliver on its Net Zero by 2050 programme and prepares to host the Cop28 climate conference next year, Masdar will speed up the delivery of world-scale projects and “help meet the world’s growing demand for clean energy”, Dr Al Jaber said.

“For Adnoc, our participation in Masdar is an important pillar in our strategy to expand clean energy production, unlock new opportunities for industrial development and drive decarbonisation,” he said.

The UAE, Opec's third-largest oil producer, plans to invest Dh600 billion by 2050 in renewable and clean energy capacity and achieve net-zero emissions in the next three decades.

Established by Mubadala in 2006, Masdar took a leadership role in the global energy sector and also helped to drive the nation’s economic diversification and climate action agenda.

Masdar currently operates in 40 countries and has a total investment of about $20 billion.

Last year, the company increased its global clean energy portfolio capacity by 40 per cent. This year, it signed agreements to explore and develop renewable energy and green hydrogen projects with a combined capacity of more than 10 gigawatts.

Masdar has an ambitious target to grow its capacity to at least 100 gigawatts of renewable energy capacity globally by 2030. The largest share of this capacity will come from wind and solar technology.

Beyond the initial goals, the company aspires to develop in excess of 200 gigawatts of renewable energy, aiming to solidify its position as a world leader in the renewable energy sector.

“We established Masdar 16 years ago based on an early conviction that building capabilities and supporting innovation and scale across the clean energy spectrum would be transformative for the nation and an investment in future generations,” said Khaldoon Al Mubarak, managing director and group chief executive of Mubadala.

“This significant milestone helps unlock synergies in Masdar’s continued growth journey and the UAE’s global energy leadership.”

The partners aim to rapidly scale up Masdar’s green hydrogen business as the company pushes to achieve an annual green hydrogen production capacity of up to a million tonnes by 2030, equivalent to saving more than six million tonnes of carbon dioxide emissions.

Hydrogen — which can be produced from both renewable energy and natural gas — is on track to become a more important fuel as economies and industries transition to a low-carbon world to mitigate climate change and global warming.

It comes in various forms, including blue, green and grey. Blue and grey hydrogen are produced from natural gas, while green is derived from renewable sources.

The UAE aims to export hydrogen as demand for clean fuel increases globally amid the energy transition pivot. The country has a goal of capturing a quarter of hydrogen market share worldwide.

Masdar will focus on growth opportunities around the world, including in the US, the Mena region, central Asian states, the Asia-Pacific region and key European countries.

“Growth is expected to come from a combination of new and existing projects, as well as acquisitions,” the regulatory filing said.

Mr Al Mubarak said global co-operation was vital to achieving critical scale in clean energy sources “and we are committed to leveraging our partnerships to enable Masdar to deliver a broader global impact”.