ADNOC today announced that ADNOC International Limited has entered into an investment agreement with Covestro AG, one of the world’s leading chemical players, and launched a voluntary public takeover offer to all shareholders for a cash consideration of AED254 (€62) per share.
This landmark agreement marks a milestone in ADNOC’s international growth strategy as the company delivers on its ambitious international expansion with a focus on gas, LNG, chemicals, and low-carbon energies, in line with its strategy.
“This strategic partnership is a natural fit and aligns seamlessly with ADNOC’s ongoing smart growth and future-proofing strategy and our vision to become a top five global chemicals company,” stated Dr. Sultan Ahmed Al Jaber, ADNOC managing director and group CEO.
Global leader in high-tech specialty chemicals
Covestro is a German industrial pioneer and a global leader in the high-tech specialty chemicals space, boasting a suite of cutting-edge technologies and a range of products that support decarbonization and the circular economy. Serving over 8,500 international business customers globally, the company also has 48 production sites worldwide and 13 research and development (R&D) facilities.
Covestro offers more than 10,700 world-class specialty solutions. It designs and manufactures advanced specialist products used in semiconductors and thermal management solutions for servers and structural components, supporting the growth of artificial intelligence (AI) by producing thermal conductive solutions and providing advanced molding technologies.
Advancing ambitious chemicals growth strategy
Covestro’s specialty chemicals business complements ADNOC’s ambitious chemicals growth strategy. Moreover, it aligns with the UAE’s commitment to global leadership in advanced technologies. Covestro would become the foundational platform for ADNOC’s performance materials and specialty chemicals business. In addition, it will further drive the diversification of ADNOC’s chemical portfolio.
“With ADNOC International’s support, we will have an even stronger foundation for sustainable growth in highly attractive sectors and can make an even greater contribution to the green transformation,” added Dr. Markus Steilemann, CEO of Covestro.
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Petrochemical demand to grow
Petrochemical demand will likely increase by a compound rate of 2 percent between 2024 and 2050. The chemicals market will also likely double by 2050, yielding attractive economic returns.
Therefore, the positive long-term outlook for chemicals makes Covestro an attractive investment for ADNOC. The company has industry-leading facilities and technologies. It also operates globally and generates more than half of its revenues from the Asia-Pacific and North America.
The takeover offer will be subject to a minimum acceptance threshold of 50 percent plus one share of Covestro’s issued share capital, and customary regulatory approvals.
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