Abu Dhabi’s Adnoc Secures $13B Acquisition of German Petrochemical Leader Covestro

The Abu Dhabi National Oil Company (Adnoc) has agreed to purchase German petrochemical firm Covestro for $13 billion.

This deal marks one of Europe’s largest acquisitions in 2024. Adnoc will launch a public offer for Covestro shares, paying €62 per share.

The offer represents a 21% premium over Covestro’s closing price on June 23, before negotiations began.

The agreement also includes a capital injection of €1.17 billion into Covestro through the issuance of 18.9 million new shares.

Covestro, a spin-off from Bayer in 2015, is a leading manufacturer of high-quality polymer materials.

The company operates 48 production facilities worldwide and employs 17,500 people. Its main competitors include BASF and Braskem.

In 2023, Covestro reported a loss of €198 million, an 18% improvement from 2022. The company’s revenue fell 20% to €14.4 billion. Listed on the Frankfurt Stock Exchange, Covestro is valued at €10.9 billion.

Adnoc, a major oil and gas producer, has been expanding into other sectors to diversify its revenue streams.

The petrochemical industry is part of this initiative. Earlier this year, Adnoc acquired nearly 25% of Austrian chemical company OMV.

The company had previously shown interest in acquiring Novonor’s stake in Braskem. Adnoc offered approximately R$10.5 ($2) billion for the stake but withdrew its bid in May. The reasons for the withdrawal were not disclosed.

This acquisition of Covestro aligns with Adnoc’s strategy to expand its petrochemical operations.

It demonstrates the company’s commitment to diversifying its portfolio and strengthening its position in the global chemical industry.

Abu Dhabi’s Adnoc Secures $13B Acquisition of German Petrochemical Leader Covestro

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