NH Investment & Securities headquarters in Seoul. (NH Investment & Securities)
NH Investment & Securities, the brokerage unit of South Korea’s NongHyup Financial Group, has joined a consortium to acquire a stake in the United Arab Emirates’ state-owned Abu Dhabi National Oil Company’s natural gas pipelines, according to investment banking sources Monday.
It is part of the $8 billion project financing from the oil firm, composed of the American private equity fund firm Canadian Brookfield Asset Management, Italian infrastructure operator Snam, Ontario Teachers’ Pension Plan, Singaporean sovereign fund GIC and NH Investment & Securities, the sources added.
No final agreement has been reached and details of the project are still subject to change, but the financial deal is anticipated to be one of the largest for an infrastructure asset and the largest deal by a local securities firm.
Despite the profitability, investor sentiment over the given deal has been sluggish for months due to the persisting coronavirus pandemic.
Earlier in March, other parties including Australian fund manager IFM Investors dropped out the deal, leaving the NH-affiliated consortium as the only remaining bidder to acquire the stake in Adnoc’s $15 billion pipeline business.
The state-run oil company is reportedly selling the asset to raise funds amid a slump in crude oil prices. The pipeline seller would guarantee the buyers a minimum yield for the long term to make the successful deal, according to the sources.
Prior to the recent deal, Adnoc sold a 40 percent stake in its oil pipeline network to global investment firms KKR & Co. and BlackRock for $4 billion last year, securing two decades of guaranteed returns.
By Jie Ye-eun (email@example.com