The Abu Dhabi National Energy Company (Taqa), one of the fastest growing energy investment ventures in the Middle East, is planning to intensify its push into global markets this year to achieve its target of becoming an international investment giant, according to its Chief Executive Officer.
Peter Barker-Homek said the company’s performance was strong in 2007 and this year could be even better following the latest major acquisitions.
About plans to issue between $3 and $9 billion (Dh11-33bn) in bonds, he said Taqa is pursuing such plans, with the successful issue of $2bn in October.
In an interview with Emirates Business, Barker-Homek said Taqa’s revenues more than doubled to Dh5.3bn in the first nine months of 2007, while net profits leaped by around 56 per cent to Dh587 million.
He put total assets at around $14bn at the end of 2006 and expected them to surge by $7bn to $21bn this month. Eventually, Taqa will be in control of $60bn,” he added.
“In 2008, Taqa plans to continue to build a diversified international portfolio of operations and investments across the value chain, balanced across stable developed economies and growing emerging markets,” he said.
“We are and will continue to be a model corporate citizen in all of the markets in which we operate, and, through additional acquisitions across the value chain, we will achieve our aim of becoming a $60-billion company by assets. We have already come a long way and have placed ourselves well and truly on the global energy map, but the story does not end here,” said the CEO.
Following are excerpts from the interview with Peter Barker-Homek.
How do you evaluate Taqa’s performance in 2007. Was it better than 2006?
We are not in a position to discuss our performance for the whole of 2007 in detail, but if we look at the results of the first nine months, which we announced at the end of October, our revenues more than doubled to Dh5.3bn compared to Dh2.4bn in the same period in 2006.
Similarly, revenues from electricity and water grew by 45 per cent, while revenues from oil and gas accounted for Dh567.6m from zero in the same period in 2006. Net profits also increased to Dh587m from Dh375m, which is 56 per cent up on the previous year.
One of the drivers of this growth has been the significant shift in strategy for the company, which now takes a global investment view. While we saw strong organic growth in our UAE business, 2006 also saw a number of acquisitions outside of the Middle East, which account for much of the overall growth. For example, we invested a combined $1.1bn in Talisman’s Brae assets and BP Nederlands, which established our upstream and midstream business.
We also acquired power generation assets outside of the UAE with the acquisition of ABB’s interests in assets in the Middle East, India and Africa, and CMS Generation.
In the third quarter we announced three significant acquisitions in Canada – Northrock Resources, Pioneer Canada and PrimeWest Energy – all of which are being rolled into Taqa North, our North America business. These three acquisitions will have an impact on our numbers in 2008.
What are your plans for 2008? More acquisitions, bond issues or new investments? Which sectors and which countries?
In 2008, Taqa plans to continue building a diversified international portfolio of operations and investments across the value chain, balanced across stable developed economies and growing emerging markets.
We will also be focusing on successfully and fully integrating the newly acquired assets into the Taqa family, realising the synergies that we have identified across the group. It is important to us to see a smooth transition of ownership, while ensuring business continuity across the board.
We want to make sure all of Taqa’s new employees feel very much part of the team, which is based on meritocracy and is arguably one of the most diverse and inclusive organisations anywhere.
All in all, we aim to achieve best in class status as a global energy player.
What happened to the billion dollars bond issues you have talked about?
Our last bond offering to the international investment community was for $2bn, which was priced in end-October. This was seen as a success despite the challenging global fixed-income market.
What is the expected size of Taqa’s assets by the end of 2007? What are your expected profits? Is it more or less than had been expected?
Following the expected closing of the PrimeWest acquisition in the middle of January 2008, Taqa will be a $21bn company by assets, compared to the $14bn of assets at the end of 2006. Our stated aim is to become a $60bn company by assets. I can’t discuss our profitability numbers for the full year, although the profitability we achieved in the first nine months of 2007 – Dh587m – was in line with our planning.
Are there any plans for more privatisations in Taqa?
Taqa was partly privatised in July 2005 – 25 per cent of the company’s shares were offered to UAE nationals and listed on the Abu Dhabi Stock Market. The offering was heavily oversubscribed, and we now have 10,000 investors in our shares.
How do you see Taqa on the international energy investment map in the medium and long term?
We have evolved from a national energy player to a truly global player in a short period of time. We have assets in the Middle East, Africa, Asia, Europe and the US. We can boast some of the most respected individuals in the sector on our team, and in our heart we are a meritocratic and diverse organisation, which encourages people to achieve their best to help Taqa achieve its best.
We are and will continue to be a model corporate citizen in all of the markets in which we operate, and, through additional acquisitions across the value chain, we will achieve our aim of becoming a $60bn-company by assets. We have already come a long way and have placed ourselves well and truly on the global energy map, but the story does not end here.
CEO of Taqa
Before he joined Taqa in 2006, the American-born Peter Barker-Homek worked with British Petroleum where he was responsible for the company’s mergers and acquisitions. Barker-Homek has also worked with British Gas and Merrill Lynch. He was recently nominated CEO of the Year at the Platts 2007 Global Energy Awards.
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