OMV decides to pursue negotiations with ADNOC about potential cooperation in their polyolefins business

2023-07-14 13:37:08

Vienna (OTS) –

The Executive Board of OMV has just decided to pursue negotiations with ADNOC about a potential cooperation in their polyolefins business. The cooperation would include a possible combination of the Borealis and Borouge businesses as equal partners under a jointly controlled, publicly traded platform for potential growth acquisitions with the goal of creating a global polyolefins company with a significant presence in key markets.

Borealis is one of the world’s leading providers of advanced and sustainable polyolefin solutions and a European leader in polyolefin recycling. 75% of the shares in Borealis are held by OMV and 25% by ADNOC. Borouge is a leading petrochemical company providing innovative and differentiated polyolefin solutions. Borouge is 54% owned by ADNOC and 36% owned by Borealis. The Company’s remaining interest is listed on the Abu Dhabi Securities Exchange (“ADX”).

“A potential transaction would have strong and compelling industrial relevance,” said Alfred Stern, CEO of OMV AG. “The combination of the strongly complementary companies would combine Borealis’ technological expertise and sustainable specialty polyolefin solutions and Borouge’s advantageous cost position and access to large and attractive markets and create a company with significant potential for organic and inorganic growth.”

“This would build on our more than 25 years of successful partnership with ADNOC and represent a possible path for the achievement of OMV’s 2030 strategy. At the same time, there are a number of transaction parameters that require mutual agreement during the negotiation,” he added.

Any potential transaction would be in line with the acquisition criteria and capital allocation framework set by OMV. A further announcement will be made in due course.

A potential transaction would be subject, among other things, to (i) agreement with ADNOC on the commercial transaction parameters (such as, among other things, the valuation of the companies involved) as well as the transaction documents in forthcoming negotiations, (ii) approvals of a potential transaction by the Management Board and the Supervisory Board of OMV, (iii) approvals of a potential transaction by ADNOC, and (iv) approvals (such as merger control clearances) by authorities.

OMV Aktiengesellschaft

With group sales of EUR 62 billion and a workforce of around 22,300 in 2022, OMV is one of the largest listed industrial companies in Austria.

In the Chemicals & Materials sector, OMV, through its subsidiary Borealis, is one of the world’s leading suppliers of advanced and circular polyolefin solutions and is a European market leader in the area of basic chemicals and plastics recycling. Together with the two important joint ventures – Borouge (with ADNOC, in the UAE and Singapore) and Baystar™ (with TotalEnergies, in the USA) – Borealis supplies products and services to customers all over the world. The OMV Fuels & Feedstock business area produces and markets fuels and raw materials for the chemical industry, operates three refineries in Europe and holds a 15% interest in a refinery joint venture in the UAE. OMV operates around 1,700 filling stations in eight European countries. In the Energy division, OMV explores, develops and produces oil and gas in the four core regions of Central and Eastern Europe, the Middle East and Africa, the North Sea and Asia-Pacific. Average daily production in 2022 was 392 kboe/d. The activities also include the low carbon business and the entire gas business.

OMV will evolve from an integrated oil, gas and chemicals company into a leading provider of innovative sustainable fuels, chemicals and materials, while becoming a global leader in the circular economy. With the switch to a low-CO2 business, OMV is pursuing the goal of becoming climate-neutral in all three scopes by 2050 at the latest.

OMV shares are traded on the Vienna Stock Exchange (OMV) and as American Depository Receipts (OMVKY) in the USA.