Photo Credit : WAM
ADNOC Distribution has signed a definitive agreement to acquire 100 percent of the share capital of Shell Downstream South Africa (SDSA) from Shell South Africa Holdings in a transaction valued at approximately $1 billion, marking a major step in the company’s international expansion strategy.
The deal, which remains subject to regulatory approvals and customary closing conditions, is expected to be completed in 2027. Following the acquisition, a 28 percent stake in SDSA is expected to be transferred to a local empowerment partner and an Employee Stock Option Plan (ESOP), supporting South Africa’s inclusive economic participation goals.
As part of the agreement, ADNOC Distribution will enter into a long-term brand licensing arrangement, allowing the Shell brand to remain in use across retail fuel stations and lubricants operations in South Africa. Customers are expected to continue receiving the same services under ADNOC Distribution’s ownership.
Commenting on the announcement, Eng. Bader Saeed Al Lamki, CEO of ADNOC Distribution, described the acquisition as a significant milestone in the company’s international growth journey. He said the transaction reflects confidence in South Africa’s well-regulated fuel retail market and strengthens ADNOC Distribution’s strategy to expand globally while creating long-term value for shareholders, partners and customers.
Shell Downstream South Africa operates an extensive network of 580 company-owned and dealer-operated fuel and convenience sites across the country. Its operations also include lubricants, commercial fuels, aviation and marine fuel businesses. As of 2025, the company recorded annual fuel sales of approximately 3.5 billion litres and operated 360 convenience stores.
ADNOC Distribution said South Africa offers attractive long-term growth opportunities, supported by investments in transport infrastructure, a growing driving-age population and a transparent fuel pricing framework designed to protect margins from inflation and currency fluctuations.
The company also confirmed its intention to contribute to South Africa’s economic development by supporting energy security, job creation and local participation. ADNOC Distribution plans to appoint a local partner aligned with the country’s Broad-Based Black Economic Empowerment (B-BBEE) framework and experienced in the domestic fuel sector.
Financially, the acquisition is expected to strengthen ADNOC Distribution’s earnings, with the company projecting a 6 percent increase in earnings per share during the first full year after completion. The transaction is also expected to deliver returns above the company’s investment hurdle rate for its fuel and convenience retail business.
Once completed, South Africa will become the fourth international market for ADNOC Distribution, following its expansion into Saudi Arabia in 2018 and the acquisition of a 50 percent stake in TotalEnergies Marketing Egypt in 2023.
BofA Securities acted as the sole financial adviser on the transaction, while A&O Shearman and ENS served as legal advisers.
