Covestro Stock: EU Probes Adnoc's Takeover Bid

The European Commission has launched an in-depth investigation into Abu Dhabi's state-owned oil giant Adnoc's planned €11.7 billion acquisition of German chemical company Covestro. Brussels regulators expressed concerns that potential foreign subsidies might distort European competition, specifically pointing to an unlimited state guarantee from the United Arab Emirates and a pre-arranged €1.2 billion capital injection by Adnoc. The Commission fears these state supports may have enabled Adnoc to offer terms significantly exceeding what private investors could match. The deal, which values Covestro's shares at €11.7 billion and reaches approximately €16 billion when including debt, had already progressed with Adnoc securing over 91 percent of shares.

Market Remains Optimistic Despite Delays

Despite regulatory hurdles introducing uncertainty until the Commission's final decision deadline on December 2, Covestro's stock remained stable on Monday, even showing a slight increase of 0.17 percent to €60.56 in XETRA trading. This suggests investors remain confident the acquisition will ultimately proceed, possibly with conditions. The investigation is being conducted under new EU regulations designed to prevent competitive distortions arising from state-backed takeovers, potentially setting a precedent for how Europe handles foreign state-supported acquisitions moving forward.

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Source StockWorld