Adnoc and Austria’s OMV agreed terms of an agreement to merge their polyolefins businesses after years of negotiations, creating a USD 60 bn global polyolefins player set to be the world’s fourth largest, according to a statement. The merged business, set to be based in Austria with a regional HQ in the UAE, will have a capacity of 13.6 mn tonnes per year across Europe, the Middle East and North America.

REMEMBER- The merger has been in the works for nearly two years, delayed by changes in management, the elections in Austria last year, and some sticking points related to the technicalities of the merger.

Also part of the package: The companies are acquiring Abu Dhabi sovereign wealth fund Mubadala’s Nova Chemicals for USD 13.4 bn, including debt, with the acquisition set to be financed by a bridge loan, later refinanced by way of a capital increase. We heard this could be on the cards earlier this month.

Meet Borouge International: The new merged entity will be jointly owned by Adnoc and OMV, with each owning a c.47% stake. The remainder of the shares will be freefloat, after the company lists on the ADX, pending approval from the Securities and Commodities Authority. It could also later be listed on the Vienna Stock Exchange, according to a separate statement from OMV.

Borouge International will be under XRG’s umbrella: Adnoc will transfer its stake in the new entity to XRG, its new USD 80 bn renewables and chemicals platform. The platform also acquired a majority stake in German chemicals company Covestro in December.

Financing plans: OMV is set to inject some EUR 1.6 bn into the newly merged entity, which will be reduced upon closing of the transaction in accordance with equity value changes after the payment of dividends. It is also set to raise some USD 4 bn in capital in 2026 to become compliant with MSCI index inclusion and secure an investment grade credit rating, the statement said. Adnoc and OMV will not be participating in the capital increase.

Timeline: The merger is set to be completed in 1Q 2026, pending approval from OMV’s supervisory board and regulators.

Tags: