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ADNOC Acquires Pool Operator Navig8 for $1.5B to Expand Global Reach

tanker
Navig8 adds 32 tankers to the company and its pool operations (Navig8)

Published Jun 3, 2024 5:14 PM by The Maritime Executive

 

The maritime logistics arm of Abu Dhabi’s national oil company continues its strategy of growth announcing it is acquiring Singapore-based Navig8, which bills itself as the world’s largest independent pool and commercial management company in the tanker sector. Launched just 17 years ago, Navig8 is an international shipping pool operator and commercial management company with an owned fleet of 32 modern tankers and a presence in 15 cities across five continents.

Under the terms of the agreement, ADNOC Logistics & Services will acquire 80 percent of Navig8 for $1.04 billion effective with backdating to January 1, 2024. In addition, the deal includes a deferred consideration of $335 million to $450 million for the remaining 20 percent to be paid in 2027.

ADNOC L&S which went public just a year ago in a very successful offering that sold 15 percent of the company highlights that this is the latest step in a more than $5 billion strategic investment target mapped out to investors at the time of the offering. It is in keeping with ADNOC (Abu Dhabi National Oil Company) and Abu Dhabi’s ambitions for growth. 

“We are progressing towards achieving our strategic growth investment target with major expansions of our fleet and global footprint,” said Captain Abdulkareem Al Masabi, CEO of ADNOC L&S. “The acquisition of Navig8, combined with our recent shipbuilding activities, demonstrates that ADNOC L&S is delivering on our strategy to maximize shareholder value.”

According to the company, the acquisition instantly positions it as a global company in energy maritime logistics by expanding its reach. Navig8, which had 2023 earnings of around $400 million (EBITDA) they said will provide strong growth, be accretive to earnings, and provide returns to the company. They projected a 20 percent increase in earnings while also forecasting significant cost savings from the combination with targets of over $100 million annually in savings.

ADNOC L&S highlights that with the acquisition it is expanding its capabilities and services. Its service offering will now include pooling, commercial management, bunker trading, technical management, and ESG-focused digital solutions. Following the completion of the acquisition, the current Navig8 management team will continue to operate the business on a day-to-day basis, while maintaining its current operations under the existing Navig8 brand.

Navig8 is also in the midst of building six new eco-friendly MR vessels due for delivery by 2025 from New Times Shipbuilding Co. in China. The first of the vessels, each 50,000 dwt, entered service in January 2024 and the second Navig8 Exceed was delivered in April. 

The company was set up with a focus on oil port logistics operations and they remain the exclusive port operator in Abu Dhabi. It also has a fleet of 57 owned vessels in the gas, crude, and products sectors, as well as dry bulk, containers, and offshore services. Last week ADMOC L&S announced a further deal to build at least six 174,000 cbm gas carriers. The order was split evenly in South Korea between Samsung Heavy Industries and Hanwha Ocean with the vessel due for delivery in 2028.