OMV's Borealis to Merge with Borouge in a 30 Billion Euro Deal

OrganizationsOther ♦ Published: December 14, 2023; 18:06 ♦ (Vindobona)

OMV's subsidiary Borealis is set to merge with the Abu Dhabi-based petrochemical company Borouge, creating a new global heavyweight in the chemical and plastic sector with an estimated value of 30 billion euros. This significant move marks a transformative step in the ongoing value creation and chemical growth strategy of both companies.

OMV subsidiary Borealis will soon be part of a 30 billion euro chemicals and plastics group. / Picture: © Borealis

Abu Dhabi National Oil Company (ADNOC) and OMV AG have entered formal negotiations for this merger, combining their existing shares in Borouge plc and Borealis AG, as reported by the Austrian newspaper "DiePresse". ADNOC, as the majority shareholder of Borouge, and OMV, holding the majority in Borealis, are spearheading this strategic move, subject to approval from Borouge's governance and regulatory clearances.

This merger comes as a strategic development, especially following the recent climate conference in Dubai, where Sultan Al Jaber, ADNOC's Chief Executive, played a pivotal role. By combining Borealis, partially owned by OMV, and Borouge, a significant player on the Abu Dhabi Securities Exchange, this merger aims to create a global leader in the petrochemical industry.

Borealis, known for its innovative approach in the petrochemical sector, brings significant value to the table. The intricate negotiation process was influenced by the complex ownership structures of both entities. OMV's decision not to comment on the ongoing discussions reflects the delicate nature of these high-stake negotiations.

The new entity is expected to leverage its combined strength, optimizing resources and expertise. This move is seen as a strategic step towards enhancing the global presence of both companies in the chemical and plastics industry.

The merger is set to have a significant impact on the global petrochemical market. The creation of this new chemical titan will not only enhance the competitive landscape but also potentially influence global supply chains and market dynamics in the sector.

The OMV-Borealis and Borouge merger represents a landmark deal in the petrochemical industry, potentially reshaping the market and setting new standards in the sector. This strategic move is aligned with the broader goals of both OMV and ADNOC, enhancing their global footprint and solidifying their positions as key players in the industry.