ADNOC Distribution brings Reatile into Shell deal

Arabian Post Staff -Dubai

ADNOC Distribution has agreed to bring South Africa’s Reatile Group into its planned acquisition of Shell Downstream South Africa, giving the local energy investor a minority interest after the $1 billion takeover is completed.
The two companies signed a long-term Broad-Based Black Economic Empowerment agreement on August 20, advancing the ownership structure for ADNOC Distribution’s entry into South Africa’s fuel retail market. The size and financial terms of Reatile’s individual stake have not been disclosed.

ADNOC Distribution agreed in July to acquire 100% of Shell Downstream South Africa, or SDSA, from Shell South Africa Holdings. The transaction carries an implied enterprise value of about $1 billion before adjustments for net debt and working capital and is expected to close in 2027, subject to regulatory approvals and other conditions.

Once the acquisition is completed, ADNOC Distribution plans to transfer part of SDSA to Reatile and an employee ownership arrangement. The company previously said a combined 28% interest would be allocated to a local empowerment partner and an Employee Stock Option Plan. It has not disclosed how that 28% will be divided between Reatile and employees.

The structure would leave ADNOC Distribution with a controlling interest while introducing local ownership in line with South Africa’s economic empowerment framework. Reatile’s involvement also gives the Abu Dhabi-listed retailer a partner with extensive experience across the country’s energy and infrastructure businesses.

SDSA operates a network of about 580 company- and dealer-owned mobility and convenience sites across South Africa. Its activities extend beyond service stations to lubricants, commercial fuels, aviation and marine operations. The business handled fuel volumes of about 3.5 billion litres in 2025 and operated roughly 360 convenience stores.

The scale makes the transaction one of ADNOC Distribution’s most significant international expansion moves. South Africa would add a large established retail network to a portfolio that already extends beyond the UAE into Saudi Arabia and Egypt.

ADNOC Distribution expects the acquisition to increase earnings per share by about 6% during the first full year after completion. Management has also said the investment is expected to generate an internal rate of return above its required hurdle rate.

Reatile, established in 2003, is a Johannesburg-based investment holding group focused heavily on energy, petrochemicals and industrial businesses. Its portfolio spans liquefied petroleum gas, natural gas distribution, compressed natural gas, renewable power, fuel infrastructure and energy storage.

The group has built its presence through investments including Egoli Gas and CNG Holdings, alongside interests in Easigas and renewable energy projects. It is also involved in the development of the Zululand Energy Terminal at Richards Bay, an LNG import project intended to support future gas supplies and power generation.

Reatile’s selection adds a domestic partner with both operating experience and knowledge of South Africa’s regulatory environment. The arrangement is designed to support local economic participation, employment and energy security while enabling ADNOC Distribution to retain operational control of SDSA.

ADNOC Distribution chief executive Bader Saeed Al Lamki has described the partnership with Reatile as an important step in the company’s commitment to South Africa, highlighting local participation as part of its longer-term investment approach.

Shell will remain visible to motorists despite the ownership change. ADNOC Distribution plans to enter a long-term licensing agreement that will keep the Shell brand on South African service stations and lubricants operations after the acquisition closes. Customers will therefore continue to see Shell-branded sites even though control of the downstream company changes hands.

Shell has also said SDSA employees will retain their employment under the new ownership. Its other activities and interests in South Africa are outside the transaction.