Abu Dhabi special acquisition firm begins trading on stock exchange

A joint stock from two Emirati investment firms began trading on the Abu Dhabi stock exchange today. 

ADC Acquisition Corporation is a Special Purpose Acquisition Company founded by the Abu Dhabi Developmental Holding Company (ADQ) and the Abu Dhabi-based Chimera Investment. It began trading today on the Abu Dhabi Securities Exchange under the ticker “ADC.” The listing followed ADC selling around $100 million in shares at a price of $2.72 per share to private investors beginning May 12, the official Emirates News Agency reported today. 

“The UAE's first SPAC represents a major endorsement of Abu Dhabi as a financial centre anchored with strong market principles and capital-raising potential,” said ADQ CEO Mohamed Hassan Alsuwaidi, according to the agency.

ADC’s stock jumped 30% on its first day on the exchange, Bloomberg reported. 

What is it? Special Purpose Acquisition Companies, aka SPACs, exist to raise capital through stock offerings from merged companies. They do not have commercial operations of their own, according to Investopedia. ADC is the first SPAC in the Middle East, according to Bloomberg. 

Why it matters: ADQ is a sovereign wealth fund of the United Arab Emirates. The fund has been active with a variety of investments this year. In February, they received regulatory approval to launch a new digital banking platform. In April, ADQ invested $1.8 billion in five publicly-traded Egyptian companies. Earlier this month, they signed an investment agreement with Greece’s Hellenic Development Bank.