meed-logo

line1 line2 line3
SIGN IN / REGISTER

Adnoc and OMV agree $60bn Borouge-Borealis merger deal

4 March 2025

Abu Dhabi National Oil Company (Adnoc) and Austrian energy company OMV have agreed the terms of a binding framework agreement for a proposed combination of their shareholdings in Abu Dhabi’s Borouge and Austria-based chemicals producer Borealis.

Adnoc has also entered into a share purchase agreement with Canada-based Nova Chemicals Holdings, an indirectly wholly-owned company of Abu Dhabi’s sovereign wealth institution Mubadala Investment Company, for 100% of Nova Chemicals Corporation (Nova).

Adnoc and OMV have also agreed that upon completion of the planned merger of Borouge and Borealis, the new entity – which will be known as Borouge Group International – will acquire Nova for $13.4bn including debt, further expanding its footprint in North America.

The acquisition, together with the recontribution of the upcoming Borouge 4 petrochemicals project in Abu Dhabi, will create a major polyolefins producer, valued at over $60bn, which will be the world’s fourth-largest by nameplate production capacity.

Borouge Group International is intended to be headquartered and domiciled in Austria, with regional headquarters in the UAE. In addition, Borouge Group International will hold corporate hubs in Canada’s Calgary, Pittsburgh in the US and Singapore.

The combination of Borouge and Borealis, and the acquisition of Nova, are expected to complete in the first quarter of 2026, subject to regulatory approvals and other customary conditions, Adnoc said.

“The agreement strengthens the close collaboration and strategic partnership between Adnoc and OMV,” the Abu Dhabi energy giant said in a statement.

Financial terms of the agreement

Borouge Group International will be listed on the Abu Dhabi Securities Exchange (ADX), subject to approval by the UAE Securities & Commodities Authority (SCA) and ADX.

Under the terms of their agreement, Adnoc and OMV will hold equal stakes of 46.94% in Borouge Group International, with joint control and equal partnership. The remaining 6.12% will be in free float, subject to SCA approval and assuming all existing Borouge free float shareholders agree to exchange their existing shares in Borouge for shares in Borouge Group International.

Upon completion of the deal, Adnoc will transfer its stake in Borouge Group International to XRG, its newly-formed investment company that focuses on low-carbon energy sources and the global chemicals value chain.

The acquisition implies a multiple of approximately 7.5 times forward through-the-cycle earnings before interest, taxes, depreciation and amortisation (Ebitda), and is expected to be debt financed through the capital markets. 

Borouge Group International is expected to raise up to $4bn of primary capital in 2026, to achieve relevant MSCI index inclusion and secure an investment-grade credit rating, with a target through-the-cycle net leverage of up to 2.5 times Ebitda.

The proposed agreement assumes a primary cash injection of €1.6bn ($1.67bn) by OMV into Borouge Group International. The cash injection will be reduced accordingly upon closing, due to adjustment of the equity value of Borouge and Borealis after expected dividend payments up to completion.

Paris-headquartered Rothschild & Co acted as the lead financial advisor to OMV on this transaction.

ALSO READ: Adnoc makes $16.3bn takeover offer for German chemicals firm

Borouge 4 – which is the fourth expansion phase of Borouge’s petrochemicals complex in Ruwais Industrial City – is likely to be among the key growth drivers, with projected recontribution by the end of 2026, when the estimated $6.2bn project is expected to be commissioned.

Recontribution of Borouge 4, when fully operational, is expected to be at a cost of approximately $7.5bn including debt, and accretive to operating cash flows and dividends per share, with an estimated through-the-cycle Ebitda of approximately $900m.

“The proposed transactions are expected to unlock significant value for shareholders through the realisation of operational and commercial synergies, improved global market access, accelerated rollout of new innovations, and sharing and scaling of advanced technologies,” Adnoc said.

The majority shareholders estimate synergy potential of about $500m additional run-rate Ebitda, with 75% expected to be realised within three years from the completion of the merger.

Borouge Group International is expected to generate a through-the-cycle Ebitda of more than $7bn a year.

Supported by this stronger cash flow generation, the company’s dividend policy will be based on a 90% payout ratio, with potential upside for distribution based on free cash flow generation. The company will aim to maintain a minimum annual payout of 16.2 fils ($0.04) a share, representing a minimum 2% accretion against Borouge’s targeted full-year 2024 dividends per share.

Production portfolio

When operational, Borouge Group International is expected to have a combined polyolefins nameplate production capacity of approximately 13.6 million tonnes a year (t/y), including current organic polyolefin growth projects.

Borouge will be the biggest contributor to the new entity in terms of polyolefins production potential, with the company’s output increasing to 6.4 million t/y when the Borouge 4 facility is commissioned in 2026.

Nova is a leading polyethylene producer in North America, with an output capacity of 2.6 million metric t/y of polyethylene, and 4.2 million metric t/y of ethylene.

Borealis is on course to increase its production capability to 600,000 t/y this year, with the company expecting output to rise three-fold to 1.8 million t/y by 2030, when planned acquisitions and projects are completed.

“Borouge Group International will combine the highly complementary strengths of three polyolefin leaders, including competitive feedstock, differentiated and premium quality product offering, direct access to growth markets, world-class technologies and leading circularity credentials,” Adnoc said in its statement.

The proposed entity will also benefit from “an extensive production footprint, innovation centres and a global sales network”, Adnoc added.

In addition, Borouge Group International will “target a leadership position in circular solutions, building on the existing initiatives of Borealis, Borouge and Nova to further develop its sustainable polyolefin solutions”.

Borealis and Borouge have both committed to reaching Scope 1 and 2 net zero emissions targets before 2050, with Borouge Group International’s sustainability strategy and targets to be rolled out after the completion of the merger and integration processes.

READ MEED’s YEARBOOK 2025

MEED’s 16th highly prized flagship Yearbook publication is available to read, offering subscribers analysis on the outlook for the Mena region’s major markets.

Published on 31 December 2024 and distributed to senior decision-makers in the region and around the world, the MEED Yearbook 2025 includes:

> GIGAPROJECTS INDEX: Gigaproject spending finds a level
https://image.digitalinsightresearch.in/uploads/NewsArticle/13455032/main3204.jpg
Indrajit Sen

Register for MEED's guest program now to access this article.

Click here to register
Exclusive from Meed
Related Articles
  • Egypt signs gas deal with Qatar Energy and Exxon Mobil

    22 May 2026

    Egypt’s Ministry of Petroleum & Mineral Resources has signed a preliminary gas agreement with state-owned QatarEnergy and US-based Exxon Mobil.

    The memorandum of understanding (MoU) focuses on cooperation in the development of natural gas discoveries in Cyprus.

    The plan involves transporting gas from offshore discoveries in Cypriot waters to Egypt via pipelines.

    In a statement, Egypt’s Ministry of Petroleum & Mineral Resources said that the deal would strengthen the North African country’s status as a regional hub for natural gas trading.

    The agreement was witnessed by Egypt’s Prime Minister Mustafa Madbouli.

    It was signed by Muhammad Al-Bajouri, from the legal affairs department of the Ministry of Petroleum & Minerals, and Kanan Nariman, vice-president for the development of liquefied natural gas (LNG) at Exxon Mobil.

    It was also signed by Ali Immunae, director of international exploration and production at QatarEnergy.

    Commenting on the MoU signing, Saad Sherida Al-Kaabi, the minister of state for energy affairs, and president and chief executive of QatarEnergy, said: “This MoU represents an important step in advancing regional energy cooperation across the Eastern Mediterranean through unlocking the long-term commercial potential of natural gas resources across that region.”

    Egypt’s Ministry of Petroleum & Mineral Resources said the agreement paved the way for QatarEnergy and Exxon to take advantage of existing Egyptian infrastructure in the gas sector, especially the country’s existing LNG export terminals.

    Under the terms of the agreement, a study will be conducted to analyse the feasibility of linking the gas discoveries in Cyprus to Egypt’s gas facilities.

    The signatories will also establish a commercial framework aimed at achieving “the maximum possible benefit from natural gas resources in both Egypt and Cyprus”.

    Egypt’s Minister of Oil and Gas Karim Badawi said the ministry has been working with ExxonMobil to explore cooperation on the development of gas discoveries in Cyprus.

    He said the partnership with Egypt would help QatarEnergy and Exxon reduce the cost of developing the discoveries while allowing Egypt to achieve an economic return.

    READ THE MAY 2026 MEED BUSINESS REVIEW – click here to view PDF

    Global energy sector forced to recalibrate; Conflict hits debt issuance and listings activity; UAE’s non-oil sector faces unclear recovery period amid disruption.

    Distributed to senior decision-makers in the region and around the world, the May 2026 edition of MEED Business Review includes:
    To see previous issues of MEED Business Review, please click here
    https://image.digitalinsightresearch.in/uploads/NewsArticle/16944918/main.jpg
    Wil Crisp
  • Eni makes oil and gas discovery in Egypt

    22 May 2026

    A joint venture of Italy’s Eni and state-owned Egyptian General Petroleum Corporation (EGPC) has made a major oil and gas discovery in Egypt’s Western Desert region.

    The partnership, known as Agiba Petroleum Company, made the discovery with an exploratory well drilled in the Bustan South block.

    Initial estimates indicate the presence of approximately 330 billion cubic feet of gas and 10 million barrels of condensate and crude oil.

    Together, this is a total of 70 million barrels of oil equivalent (boe), making the discovery Agiba Petroleum Company’s biggest in 15 years.

    The new discovery is located only 10 kilometres from existing facilities and infrastructure, which should enable rapid development and connection to production.

    The well revealed several sandstone and limestone reservoirs, according to a statement from Egypt’s Ministry of Petroleum & Mineral Resources.

    The ministry said: “This new discovery reflects the success of the Ministry of Petroleum & Mineral Resources’ efforts and the incentives it offered to partners to intensify exploration activities in areas adjacent to existing fields.

    “This facilitates new discoveries near existing infrastructure and production facilities without the need for new infrastructure development.

    “This contributes to reducing the cost of producing a barrel, accelerating the integration of discoveries into the production map, and encouraging partners to implement the latest data collection and analysis technologies to increase the chances of successful exploration.”

    Egypt is seeing increased interest in its oil and gas resources due to disruptions to shipping through the Strait of Hormuz, which have significantly reduced oil and gas exports from the GCC and Iraq.

    READ THE MAY 2026 MEED BUSINESS REVIEW – click here to view PDF

    Global energy sector forced to recalibrate; Conflict hits debt issuance and listings activity; UAE’s non-oil sector faces unclear recovery period amid disruption.

    Distributed to senior decision-makers in the region and around the world, the May 2026 edition of MEED Business Review includes:
    To see previous issues of MEED Business Review, please click here
    https://image.digitalinsightresearch.in/uploads/NewsArticle/16944815/main.jpg
    Wil Crisp
  • Wasl Group launches Cedarwood Estates South villas

    21 May 2026

    Dubai-based real estate developer Wasl Group has announced the launch of Cedarwood Estates South, the newest addition to its expanding freehold portfolio in Dubai.

    The project is located within The Next Chapter, Wasl’s development in the Jumeirah Golf Estates area.

    Cedarwood Estates South features 74 villas in four-, five- and six-bedroom layouts.

    The launch follows Wasl Group’s award of a contract to Beijing-headquartered China State Construction Engineering Corporation to develop the overall infrastructure for The Next Chapter.

    The masterplan spans 4.68 million square metres across six districts: Central Park, The Village, Town Centre & Grand Lake, Golf Course North, Golf Course South and Equestrian Village.

    The development will offer 780 villas, 62 mansions, 97 branded residences, 752 estate homes and 10,654 apartments.

    It will also include a five-star Mandarin Oriental resort, a tennis stadium, an 18-hole golf course and academy, an equestrian centre, a school, retail centres and other associated facilities.

    Wasl Group is one of Dubai’s largest real estate development and asset management entities, established in 2008 by the Dubai Real Estate Corporation.

    The company was set up to consolidate and manage a significant portfolio of government-owned real estate assets.

    Headquartered in Dubai, Wasl operates across residential, commercial, hospitality and mixed-use segments, and is known for masterplanned communities and urban regeneration projects.

    Over the years, Wasl has delivered several mid- to large-scale developments and partnered with international hospitality brands through its Wasl Hospitality arm, helping to expand Dubai’s hotel inventory and support the city’s wider tourism and economic growth agenda.

    According to data from regional projects tracker MEED Projects, Wasl Group has a portfolio of over 128 projects, valued at about $18bn.

    Wasl’s major developments include Wasl1, Wasl Gate, Wasl Village and Wasl 51.

    Its asset portfolio includes notable landmarks such as the Mandarin Oriental Hotel, One & Only The Palm, One & Only Royal Mirage, Nikki Beach, Grand Hyatt Dubai, Le Meridien Mina Seyahi Beach Resort & Marina, the Westin Dubai Mina Seyahi Beach Resort & Marina, Dubai Creek Golf & Yacht Club and Emirates Golf Club.

    > Be recognised among the best in the industry at the MEED Projects Awards 2026 …

    https://image.digitalinsightresearch.in/uploads/NewsArticle/16936615/main.jpeg
    Yasir Iqbal
  • Foundations progressing for Iraq gas gathering project

    21 May 2026

     

    The construction of foundations is ongoing for the $1.61bn project to develop a gas processing complex at Iraq’s Ratawi oil and gas field, according to industry sources.

    In May last year, China Petroleum Engineering & Construction Corporation (CPECC) was awarded the engineering, procurement and construction (EPC) work for the project.

    The Ratawi gas processing complex is one of four projects constituting Iraq’s Gas Growth Integrated Project (GGIP), which is being developed by French energy major TotalEnergies and its partners. TotalEnergies is the main operator of the GGIP scheme. Basra Oil Company (30%) and QatarEnergy (25%) are the other stakeholders.

    The consortium formalised the investment agreement for the project with the Iraqi government in September 2021.

    The GGIP is estimated to have a total value of $27bn, and the first phase of the project is worth about $10bn.

    When commissioned, the planned facility is expected to process 300 million cubic feet a day (cf/d) of gas. Its capacity is expected to double when a second expansion phase comes online.

    The Ratawi gas processing facility project aims to improve Iraq’s electricity supply by capturing associated gas that would have otherwise been flared at several oil fields, including:

    • Luhais
    • Majnoon
    • Ratawi
    • West Qurna 2
    • Tuba

    Large volumes of gas are flared from these oil fields, causing significant environmental damage. Collecting and processing flared gas will generate increased hydrocarbon revenues and reduce ecological damage.

    The gas tapped and processed from the oil fields will then be used to supply power plants, helping to reduce Iraq’s power import bill.

    As well as supplying to Iraq’s national gas network to generate electricity, the Ratawi gas processing complex will increase the production of gas products, including liquefied petroleum gas and condensates.

    US-based consultant KBR has performed the front-end engineering and design work on the project.

    GGIP masterplan

    The GGIP programme is focused on developing four major projects in Iraq:

    • The Common Seawater Supply Project (CSSP)
    • The Ratawi gas processing complex
    • A 1GW solar power project for Iraq’s electricity ministry
    • A field development project at Ratawi, known as the Associated Gas Upstream Project (AGUP)

    The CSSP is designed to support oil production in Iraq’s southern oil and gas fields – mainly Zubair, Rumaila, Majnoon, West Qurna and Ratawi – by delivering treated seawater for injection, a method used to boost crude recovery rates and improve long-term reservoir performance.

    In August last year, TotalEnergies awarded China Energy Engineering International Group the EPC contract for the 1GW solar project at the Ratawi field. A month later, QatarEnergy signed an agreement with TotalEnergies to acquire a 50% interest in the project.

    Civil works and piping work have started for the project to develop a second central processing facility (CPF) at Iraq’s Ratawi oil and gas field as part of the AGUP portion of the GGIP.

    In September, Turkiye’s Enka signed a contract to develop the second CPF at Iraq’s Ratawi field as part of the second phase of the field’s development.

    Enka has yet to give a value for the contract, but it is believed to be worth more than $1bn.

    In November, US-based KBR was selected by Enka to provide detailed design services for the project.

    Enka’s contract covers the engineering, procurement, supply, construction and commissioning of the CPF for the project.

    The aim of the project is to process oil and associated gas from the Ratawi oil field to increase production capacity to 210,000 barrels a day of oil and 154 million standard cf/d of gas.

    The 1GW Ratawi solar scheme will be developed in phases, with each phase coming online between 2025 and 2027. It will have the capacity to provide electricity to about 350,000 homes in Iraq’s Basra region.

    The project, consisting of 2 million bifacial solar panels mounted on single-axis trackers, will include the design, procurement, construction and commissioning of the photovoltaic power station site and 132kV booster station.

    Separately, in June, TotalEnergies awarded China Petroleum Pipeline Engineering an EPC contract worth $294m to build a pipeline as part of a package known as the Ratawi Gas Midstream Pipeline.

    Also, TotalEnergies awarded UK-based consultant Wood Group a pair of engineering framework agreements in April 2025, worth a combined $11m, under the GGIP scheme.

    The agreements have a three-year term under which Wood will support TotalEnergies in advancing the AGUP.

    One of the aims of the AGUP is to debottleneck and upgrade existing facilities to increase production capacity to 120,000 barrels a day of oil on completion of the first phase, according to a statement by Wood.

    READ THE MAY 2026 MEED BUSINESS REVIEW – click here to view PDF

    Global energy sector forced to recalibrate; Conflict hits debt issuance and listings activity; UAE’s non-oil sector faces unclear recovery period amid disruption.

    Distributed to senior decision-makers in the region and around the world, the May 2026 edition of MEED Business Review includes:
    To see previous issues of MEED Business Review, please click here
    https://image.digitalinsightresearch.in/uploads/NewsArticle/16934508/main.png
    Wil Crisp
  • WEBINAR: Iraq Projects Market 2026

    20 May 2026

    Webinar: Iraq Projects Market 2026 
    Thursday 4 June | 11:00 AM GST  |  Register now

    Agenda:

    • Overview of the Iraq projects market landscape
    • 2025-26 projects market performance
    • Value of work awarded 2026 YTD
    • Assessment of key current and future projects
    • Key drivers, challenges and opportunities
    • Summary of the key clients, contractors and consultants
    • Size of future pipeline by sector and status
    • Ranking of the top contractors and clients
    • Short and long-term market outlook
    • Audience Q&A

    Hosted by: Edward James, head of content and analysis at MEED

    A well-known and respected thought leader in Mena affairs, Edward James has been with MEED for more than 19 years, working as a researcher, consultant and content director. Today, he heads up all content and research produced by the MEED group. His specific areas of expertise are construction, hydrocarbons, power and water, and the petrochemicals market. He is considered one of the world’s foremost experts on the Mena projects market. He is a regular guest commentator on Middle East issues for news channels such as the BBC, CNN and ABC News and is a regular speaker at events in the region. 

    Click here to register

    https://image.digitalinsightresearch.in/uploads/NewsArticle/16925011/main.gif
    Edward James