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
  • Tender issued for Libyan gas project

    17 September 2026

    An invitation to bid has been issued for a contract to conduct environmental assessments for the project to expand the Mellitah oil and gas complex in Libya.

    The bid submission deadline is 2pm today (17 September) Libyan time.

    The scope of the project includes provision of:

    • An environmental baseline study (EBS)
    • An environmental impact assessment (EIA)
    • An environmental management plan (EMP)

    The client is Mellitah Oil & Gas (MOG), which is a joint venture of Italy’s Eni and Libya’s National Oil Corporation (NOC).

    MOG is based in Tripoli and operates both onshore and offshore oil and gas facilities.

    The joint venture owns and operates six major oil and gas fields across the North African country.

    According to the tender documents, the company that is awarded the contract will need to prepare environmental management measures in compliance with:

    • Libyan environmental legislation
    • Ministry of Environment requirements
    • NOC environmental guidelines
    • Applicable international environmental standards and best practices

    The expansion of the Mellitah oil and gas complex is part of a project estimated to be worth $8bn.

    The wider project is known as the Mellitah Complex Expansion & CO2 Management Integrated Development Project.

    It has six main packages:

    • Onshore package
    • Offshore Structure A
    • Offshore Structure E
    • Subsea pipeline package
    • Site preparation work
    • Carbon capture and storage facility

    Security issues and political instability have been a major problem for Libya’s oil and gas sector since the country’s civil war started in 2011.

    Earlier this month, the Mellitah oil and gas complex was forced to shut down temporarily due to a protest over deteriorating public services.

    The existing onshore complex includes housing, processing units, storage facilities and export facilities.

    It also serves as the launch point for the Greenstream pipeline, which delivers Libyan gas directly to Italy.

    The planned expansion of the complex will involve:

    • Construction of a new fourth gas processing train
    • Construction of a third condensate train
    • Construction of a third natural gas liquids fractionation train
    • Construction of a fourth sulphur recovery unit train
    • Installation of a hydrogen sulphide enrichment unit
    • Installation of a sulphur recovery unit
    • Construction of other associated facilities

    The Mellitah complex is located about 100 kilometres west of Tripoli and is a key energy facility in the west of the country.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/19748920/main.png
    Wil Crisp
  • Nakheel awards $218m Dubai Islands buildings deal

    17 September 2026

    Register for MEED’s 14-day trial access 

    Dubai-based developer Nakheel, now part of Dubai Holding, has awarded a main construction contract worth more than AED800m ($218m) for phases one and three of Bay Grove Residences at Dubai Islands.

    The contract was awarded to the local firm Metac General Contracting Company.

    It covers the construction of 537 apartments, comprising one- to four-bedroom units, across seven residential buildings.

    Phase one includes 296 units in four buildings, while phase three comprises 241 units across three buildings.

    The works are scheduled for completion in late 2028.

    Bay Grove Residences will ultimately comprise 1,154 homes across 15 buildings. Planning is under way for the remaining 617 homes in phases two and four, with further contract awards expected.

    In August last year, Nakheel awarded a AED2.6bn ($708m) contract to Abu Dhabi-based Fibrex Contracting to build the Bay Villas project at Dubai Islands. The contract includes constructing 636 villas.

    In April this year, another AED527m ($143m) contract was awarded to local firm Al-Nasr Contracting Company to construct the primary infrastructure and utilities works on Island B at the development.

    The Dubai Islands development consists of five islands spanning 18.6 square kilometres. It features more than 59 kilometres (km) of waterfront and 20km of beaches, as well as parks, golf courses, promenades and cycling paths.

    The offshore island project gained renewed momentum in 2022, when Nakheel unveiled a new masterplan and rebranded it as Dubai Islands.

    The reclaimed islands were originally part of the Palm Deira project, which was partially completed before being put on hold in 2008.

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

    Nuclear power ambitions gather pace; Kuwait keeps dealmaking alive despite war; Region invests in raising gas processing capacity.

    Distributed to senior decision-makers in the region and around the world, the September 2026 edition of MEED Business Review includes:
    To see previous issues of MEED Business Review, please click here
    https://image.digitalinsightresearch.in/uploads/NewsArticle/19748850/main.jpg
    Yasir Iqbal
  • Aldar and Mubadala acquire Masdar City Square

    17 September 2026

    Abu Dhabi-based sovereign wealth fund Mubadala Investment Company and local developer Aldar have completed the acquisition of Masdar City Square at Masdar City, in a transaction valued at AED918m ($250m).

    The deal was executed through their joint venture established in 2024.

    Masdar City Square comprises more than 47,000 square metres (sq m) of net leasable area across seven office buildings.

    Completed in Q1 2026, the development is 99% occupied. Tenants include Taqa, the Department of Energy, Emirates College and the Mohamed Bin Zayed University of Artificial Intelligence.

    The transaction expands the joint venture’s real estate portfolio in Masdar City, which is now valued at AED4.7bn ($1.3bn).

    Masdar City is one of the region’s leading hubs for clean energy, artificial intelligence, advanced research and sustainable urban development.

    The joint venture acquired The Link project at Masdar City for AED654m ($178m) in April.

    Comprising about 32,000 sq m of net leasable area across five buildings, The Link is fully leased to a portfolio of major tenants, including Abu Dhabi Future Energy Company (Masdar) and the Mohamed Bin Zayed University of Artificial Intelligence.

    The asset includes Grade A, Leed Platinum office space, a net-zero-energy headquarters building, a multi-use hall and residential accommodation, supporting its position as a high-performing, integrated component of Masdar City.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/19748241/main5814.png
    Yasir Iqbal
  • Dubai announces new 80km highway corridor

    16 September 2026

    Dubai has approved the construction of the new fourth corridor, a major highway programme aimed at boosting inter-emirate connectivity, increasing road capacity and easing congestion.

    The corridor will extend 80 kilometres, from Al-Faya Road in Abu Dhabi to Al-Shanouf Road in Sharjah.

    It will include 12 lanes, 72 bridges and 17 tunnels.

    The project is expected to reduce travel times by up to 60% and serve more than 3.1 million people, while providing links to Al-Maktoum International airport and Etihad Rail.

    It will have the capacity to accommodate 24,000 vehicles per hour in each direction.

    The project will be delivered in two phases. The first phase, running from Al-Shanouf Road to Dubai-Al Ain Road, will be delivered at a cost of AED3.5bn ($953m).

    The second phase will stretch from Dubai-Al Ain Road to Al-Faya Road in Abu Dhabi.

    The scheme adds a fourth spine to a network that has long relied on three main corridors: the E11 (Sheikh Zayed Road/Al-Ittihad Road); the E311 (Sheikh Mohamed Bin Zayed Road) and the E611 (Emirates Road), which together carry more than 850,000 vehicles commuting between Dubai and the northern emirates daily.

    That concentration has made the route one of the country’s most congested, with peak-hour bottlenecks a persistent problem for residents. The new corridor is designed to divert a significant share of that traffic onto a higher-capacity route, rather than add pressure to the existing network.

    The project also aligns with the Dubai 2040 Urban Master Plan, which anticipates population growth to 5.8 million by 2040 and calls for the expansion of roads, railways, airports and ports to support that growth and reinforce Dubai’s position as a global trading hub. This is reflected in the corridor’s direct links to Al-Maktoum International airport and Etihad Rail.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/19725878/main.jpeg
    Yasir Iqbal
  • Contractors submit Expo 2030 convention centre interest

    16 September 2026

     

    Register for MEED’s 14-day trial access 

    Expo 2030 Riyadh Company (ERC), responsible for delivering the Expo 2030 Riyadh venue, received contractor interest on 14 September for a contract to design and build a convention centre in the site's Collaboration District.

    Construction is slated to begin in January 2027 and take 29 months. The development will cover a total gross external area of more than 28,000 square metres (sq m). The total programme area will be about 22,000 sq m and the gross floor area will be 17,000 sq m. The maximum height of the building will be 41.5 metres.

    The venue will be laid out across two levels, with a mezzanine, roof terraces and a 4,030 sq m basement, in addition to mechanical, electrical and plumbing and back-of-house spaces.

    Two flexible exhibition halls are planned, covering a combined 7,280 sq m, as well as 3,800 sq m of pre-function space, 650 sq m dedicated to meeting rooms and 2,200 sq m of outdoor exhibition space in the north and south plazas.

    The appointed main contractor will assume responsibility for packages including the early works substructure and the lead design consultant's deliverables, while carrying out the full scope of superstructure, above-ground waterproofing, external facades, masonry, base build and specialised fit-outs for VVIP, VIP and visitor areas.

    Further scope includes delivering comprehensive MEP services; vertical transportation; final infrastructure tie-points; public-realm hard and soft landscaping; testing, commissioning, handover documentation; and management of the defects liability period.

    The expression of interest notice was floated on 13 September.

    The unusually brief expression of interest deadline of just one day underscores a compressed procurement timeline.

    This accelerated tender and evaluation schedule signals that project organisers are operating under time pressure to secure contractors and maintain the tight schedule required ahead of the event's opening.

    ERC expects to award the formal contract by the end of this year and begin construction in January next year.

    The project is due for completion in early 2030, in time for the main event in October of that year.

    Site progress

    Construction activity at the Expo site is accelerating, with Riyadh moving to award its first major vertical contracts and advancing infrastructure works across the programme.

    Earlier this month, MEED exclusively reported that ERC has tendered a contract to deliver the Souq areas within the expo site.

    These areas are divided into five precincts, with a total development area of about 300,000 sq m.

    In September, Saudi Arabia’s Royal Commission for Riyadh City awarded a design-and-build contract for the construction of a new metro station catering to the Expo 2030 site.

    In April, ERC awarded two contracts for the next phase of infrastructure works at the site to local firm Alyamama Company.

    The scope covered the construction of road networks and infrastructure for water, sewage, electricity, telecommunications and electric vehicle (EV) charging.

    These awards followed ERC’s January award of an estimated SR1bn ($267m) contract for initial infrastructure works at the site to local firm Nesma & Partners.

    That scope covered about 50 kilometres of integrated infrastructure networks, including internal roads and essential utilities such as water, sewage, electrical and communications systems and EV charging stations.

    The masterplan covers 6 square kilometres, making it one of the largest sites ever designated for a World Expo event. Situated north of the Saudi capital, the site will be located near the future King Salman International airport and will provide direct access to landmarks within Riyadh.

    The Public Investment Fund, Saudi Arabia’s sovereign wealth vehicle, launched ERC – a wholly owned subsidiary – in June 2025 to build and operate facilities for Expo 2030.

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

    Nuclear power ambitions gather pace; Kuwait keeps dealmaking alive despite war; Region invests in raising gas processing capacity.

    Distributed to senior decision-makers in the region and around the world, the September 2026 edition of MEED Business Review includes:
    To see previous issues of MEED Business Review, please click here
    https://image.digitalinsightresearch.in/uploads/NewsArticle/19716287/main.jpg
    Yasir Iqbal