French energy giant Engie said it has become global leader in the independent district cooling sector with the acquisition of a 40 per cent stake in UAE-based National Central Cooling Company (Tabreed) for Dh2.8 billion ($762.3 million) from Abu Dhabi-based strategic investment company Mubadala.

As part of the transaction, Mubadala which currently owns 82 per cent of Tabreed (on a fully diluted basis, through a combination of equity and mandatory convertible bonds), will be converting all its MCBs (multi-currency bonds) into shares, with 1,086,211,654 shares (equivalent to a 40 per cent shareholding in Tabreed) being transferred to Engie at a price of approximately Dh2.62 ($0.71) per share, said a statement from the company.

Mubadala will retain 1,136,507,713 million shares taking its total shareholding in Tabreed to approximately 42 per cent. Mubadala will remain Tabreed’s single largest shareholder following the transaction, which is subject to regulatory approval in the UAE. It is likely to be completed in the third quarter of 2017, it said.

Engie is a major player in highly efficient cooling networks, that are typically 50 per cent more energy efficient than individual cooling solutions and generate 50 per cent less carbon dioxide. It operates more than 250 low-carbon urban heating and cooling networks in 13 countries.

On the deal, CEO Isabelle Kocher said: “Engie will support Tabreed’s growth by contributing to delivering massively and efficiently low-carbon energy, building on our 30-year experience in the GCC countries and world-class expertise in district energy.”

“District energy networks are the fastest and most efficient ways to decarbonise dense areas and supply them with clean, renewable energy. As such, they can be seen as backbones of sustainable cities,” remarked Kocher.

“This acquisition is therefore a major step forward in the implementation of Engie’s strategy to become leader of the energy transition, by focusing especially on low-carbon solutions and customer intimacy,” she stated.

Through the partnership with Mubadala, Tabreed will become one of Engie’s main regional development platform, besides existing operations in Western Europe, North America and South-East Asia. The company expects to lead a rapid growth, through Tabreed, in new emerging markets like India, Egypt and Turkey.

Tabreed has steadily grown over the years to become a key player in enabling the region’s economic development. The company today provides its innovative cooling solutions to iconic infrastructure projects in the UAE and across the GCC region.

With over 71 district cooling plants located throughout the GCC, Tabreed delivers over one million refrigeration tons (RT) to key developments in the region. Its portfolio includes Abu Dhabi’s Al Maryah Island, Yas Island, Sheikh Zayed Grand Mosque, the Dubai Metro, Dubai Parks and Resorts, and the Jebal Omar Development Project in Makkah.

As per the deal, Engie and Mubadala will jointly work to support Tabreed’s growth strategy and management team, as long-term shareholders in the company. Through the Mubadala partnership, Tabreed will become one of Engie’s main regional development platforms, said a top official.