The deep-pocketed Abu Dhabi National Oil Company (Adnoc), backed by the United Arab Emirates (UAE) royal family, has bought the downstream business of Shell in South Africa for $1bn (R16.25bn), pipping other bidders for the assets.Adnoc, which is wholly owned by the UAE, and Shell on Tuesday confirmed the deal, expected to close next year, with about a 28% stake in Shell’s business set to be sold to the black economic empowerment players after the completion of the deal.Bader Saeed Al Lamki, CEO of Adnoc Distribution, said the mooted deal reflects the company’s confidence in South Africa’s well-regulated fuel retail sector. “Shell Downstream South Africa is a respected and financially strong business with deep roots in the local economy, and its values and ambitions align closely with our own,” he said.“By bringing it into the Adnoc Distribution family, we plan to accelerate our international expansion, diversify our platform and create sustainable long-term value for our shareholders, our partners and the customers and communities this business has proudly served for decades.”The business being sold, which excludes Shell’s upstream business where it is looking to explore for oil and gas, houses about 580 company- and dealer-owned fuel stations, commercial fuels, aviation and marine businesses, with the company reporting fuel volumes of about 3.5-billion litres last year.The board of Adnoc is chaired by Sheikh Mohamed bin Zayed Al Nahyan, President of the UAE. Subsidiary Adnoc Distribution is the leading fuel distributor, convenience store operator, and number one retail and wholesale fuel brand in the UAE.Shell said the deal is part of its strategy to restructure its downstream portfolio and focus on its key markets.“On completion, the Shell brand name will remain in South Africa though brand licensing agreements, and customers will continue to have access to Shell’s premium fuels and lubricants.“The sale does not impact any of Shell’s other activities in South Africa. Shell intends to remain a long-term partner of South Africa, supporting the country’s energy needs and ambitions in areas that are aligned with our strategy and where Shell has differentiated capabilities.”