OMV-ADNOC In Talks To Create Over $30B Chemicals & Plastics Firm: Report

Austria's OMV AG OMVKY OMVJF is in talks with Abu Dhabi National Oil Co. (ADNOC) to combine the companies, Borouge Plc and Borealis AG, to form a chemicals and plastics company worth over $30 billion.

The firms are discussing the potential valuation and ownership structure of a combined entity and may reach the formal merger terms in the coming weeks, Bloomberg reported. 

OMV owns 75% of Borealis is 75%, while ADNOC holds the remaining.

Meanwhile, Borouge is an Abu Dhabi-listed company formed by the partnership between ADNOC and Borealis, with a market value of around $22 billion.

As per the report, the two parties are considering a possible valuation of about $10 billion for Borealis (including its Borouge stake). 

The overall valuation of the combined entity may exceed $30 billion (including potential synergies), as per the people familiar with the matter.

Last month, OMV sold OMV Slovenia (including the filling stations and wholesale business) in a bid to become a sustainable and net-zero emissions company by 2050.

As of March 31, 2023, OMV's cash and cash equivalents stood at €9.5 billion. 

Price Action: OMV shares closed higher by 3.97% at $43.96 on Monday.