Deep dive into South Africa deal: greater scale, unchanged growth. Reiterate Neutral

Research evidence excerpt

Deep dive into South Africa deal: greater scale, unchanged growth. Reiterate Neutral

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ADNOC Distribution

Deep dive into South Africa deal: greater

scale, unchanged growth. Reiterate Neutral

Reiterate Rating: NEUTRAL | PO: 4.40 AED | Price: 3.97 AED

6-7% EPS uplift, but growth profile is unchanged 16 July 2026

The announced $1bn (EV) acquisition of SDSA adds a sizable fuel retail and B2B Equity

platform at an attractive multiple (5-6x entry EBITDA vs ADNOC Distribution c.11x). We

estimate the deal will be c6-7% EPS accretive but anticipate a limited impact on growth Jameel Bakhsh, CFA >> Research Analyst

trajectory. Key pro-forma P&L impacts include: 1) retail volumes/GP: 21%/38%; 2) Merrill Lynch (DIFC)

EBITDA (2027-30): +17%; 3) Net income & DPS (2027-30): +6-7%. Net debt rises to a +971jameel.bakhsh@bofa.com4 425 8252

manageable 1.1x (2027E) vs 0.8x (BofAe). We also see limited return accretion (BofAe: Michael Jacks, CFA >>

IRR c. 17%) as more investment may be needed to keep pace with a fresher asset-base Research Analyst

Merrill Lynch (South Africa)

at peers such as Engen and Astron. +27 113 055 158

michael.jacks@bofa.com

Proprietary insights: older assets, yet still competitive Mohsen Ameeri >>

Research Analyst

Our proprietary assessment of Shell's competitive position gives us three key findings: Merrill Lynch KSA Company

(1) Shell’s network has seen limited refurbishment over the past decade, in contrast to +966 112 993 741 mohsen.ameeri@bofa.com

peers Engen and Astron. (2) The convenience offering is a relative strength, ranking

second or third for amenity penetration. (3) Shell fuel stops are reviewed by customers

as middle-of-the-pack offerings (3.9 / 5, range 3.8 – 4.0), suggesting competitive