UAE’s ADNOC Begins Takeover of Covestro AG

Abu Dhabi’s ADNOC on Friday issued a takeover offer to the shareholders of German chemicals maker Covestro AG for the acquisition of all outstanding shares of Covestro, following approval by the German Federal Financial Supervisory Authority.

On 1 October, the Abu Dhabi energy company struck a deal to buy Covestro for 14.7 billion euros ($16.3 billion), including debt.

Covestro shareholders can accept the takeover offer by tendering their shares at an offer price of 62 euros ($67) in cash per Covestro share, which represents a premium of about 54% to the unaffected closing share price of Covestro on 19 June 2023, “the day prior to first market rumours regarding a potential transaction”, ADNOC International Germany Holding AG, a subsidiary, said.

The offer ends on 27 November 2024.

The takeover offer is subject to a minimum acceptance threshold of 50% plus one share of the company’s issued share capital, and other regulatory conditions being met.

ADNOC would also buy 1.17 billion euros worth of new Covestro shares from a 10% capital increase to improve funding.

Covestro is the former plastics-making business of pharmaceutical giant Bayer, which took it public in 2015. Its main products include foam chemicals used in mattresses, car seats and insulation for buildings.