EU Regulators Clear ADNOC’s Takeover of Covestro

After months of dilly-dallying, the European Commission (EC) on Tuesday approved, under the EU Merger Regulation, the acquisition of sole control of Covestro AG of Germany by Abu Dhabi National Oil Company (ADNOC) of the UAE.

The $16.51 billion transaction relates primarily to the supply of chemicals and high-performance polymer materials and solutions. The Commission concluded that the notified transaction would not raise competition concerns, given its limited impact on competition in the markets where the companies are active.

“In particular, the market investigation confirmed that ADNOC and Covestro mainly operate at different levels of the chemical and petrochemical supply chain, with no meaningful overlap between their respective activities,” EC said.

The Commission also found that, following the transaction, the companies would not be in a position to either restrict competitors’ access to important inputs or to a sufficient customer base. The notified transaction was examined under the normal merger review procedure.

CCI Clearance

ADNOC also secured clearance from Competition Commission of India (CCI) for acquiring 100% stake in Covestro’s Indian operations in December last year. Covestro also said it was confident of getting all clearance before the deadline. The transaction is expected to close in the second half of 2025.

It may be recalled that XRG, ADNOC’s new low-carbon energy investment arm, secured a 91.3% stake in Covestro following the completion of its voluntary public takeover offer, which marked the largest acquisition from a Middle Eastern buyer in Europe in 16 years.

After over a year of negotiations, Covestro’s management expressed support for ADNOC’s takeover offer earlier in November.