Abu Dhabi’s district cooling powerhouse, Tabreed, has unveiled the completion of its two largest-ever transactions, setting the stage for a significant leap in scale and operational strength.
The company, in partnership with global investor CVC DIF, finalized the acquisition of PAL Cooling Holding from Multiply Group, following all regulatory approvals. Almost simultaneously, Tabreed sealed a major concession agreement with Dubai Holding Investments to provide district cooling services to Palm Jebel Ali, one of Dubai’s most ambitious upcoming developments.
These moves mark a sharp acceleration of Tabreed’s expansion, boosting its operational footprint, diversifying its concession portfolio, and enhancing long-term cash flow predictability.
The PAL Cooling deal, valued at AED 3.87 billion in equity, brings approximately 600,000 refrigeration tonnes (RT) of connected capacity across eight exclusive concessions in Abu Dhabi’s core urban areas, including the fully integrated Al Reem Island within ADGM. The portfolio currently runs five operational plants, with one under construction and three more in advanced planning stages. The acquisition lifts Tabreed’s total connected capacity by 13 percent, reaching 1.55 million RT, and adds long-term contracts averaging 25 years with premium clients like Aldar, Modon, and Imkan.
Dr. Bakheet Al Katheeri, Chairman of Tabreed, highlighted the strategic nature of the transactions, noting they “reflect our ability to execute and scale in line with national development and decarbonisation priorities.” CEO Khalid Al Marzooqi emphasized the value of long-term, stable contracts with blue-chip developers, describing the deals as “a clear step in building the essential, sustainable infrastructure that will underpin the UAE’s next growth phase.”
On the Palm Jebel Ali front, Tabreed’s AED 1.5 billion project will roll out in phases via a joint venture—51 percent Tabreed and 49 percent Dubai Holding Investments—delivering 250,000 RT of cooling capacity. Tabreed will operate and maintain all assets under both deals, with capital efficiency embedded in the structures: PAL Cooling is funded through equity contributions and non-recourse project-level debt, while the Palm Jebel Ali project is fully consolidated under Tabreed’s joint venture.
PAL Cooling’s past performance underscores the strength of these acquisitions, with a 7.5 percent revenue CAGR and ~60 percent average EBITDA margin over the past three years. Around 60 percent of its revenues come from fixed capacity charges under long-term contracts, ensuring stable and predictable cash flows.
These landmark deals complement Tabreed’s financial strategy. Following its first-ever interim dividend, the company is now positioned to sustain and grow shareholder returns while expanding its concession-backed infrastructure base.
