ADNOC’s joint venture, Borouge, is making a significant move to strengthen its position in the petrochemicals sector. The company is merging with Austria’s Borealis to establish Borouge Group International, a major player in the industry. Additionally, the new entity will acquire Nova Chemicals for $13.4 billion, making it the world’s fourth-largest polyolefins producer.
This strategic expansion aims to enhance ADNOC’s global reach while driving long-term growth. The acquisition of Nova Chemicals strengthens Borouge Group International’s presence in North America, reinforcing its competitive advantage.
IPO and ADX Listing Plans
To support its growth, Borouge Group International plans to list on the Abu Dhabi Securities Exchange (ADX). As part of its initial public offering (IPO), the company will offer a 6.12% free float, subject to regulatory approval. Existing Borouge shareholders will have the opportunity to exchange their shares for those in the newly established entity.
This decision follows Borouge’s highly successful IPO in June 2022, which attracted strong investor interest. By listing on ADX, the company aims to provide additional value to its shareholders while ensuring sustainable financial growth.
Ownership Structure and Headquarters
Borouge Group International will be headquartered in Vienna, Austria, with a regional base in Abu Dhabi. ADNOC and OMV, Borealis’s parent company, will each hold 46.94% ownership in the new entity. To balance the shareholding structure, OMV will invest €1.6 billion into the company.
This merger represents a strategic partnership that combines expertise from both ADNOC and OMV. By leveraging their strengths, the new company will be well-positioned for long-term success.
Investor-Friendly Dividend Policy
To attract investors, Borouge Group International has introduced a competitive dividend policy. The company guarantees a minimum payout of 16.2 fils per share, reflecting a 2% increase over Borouge’s 2024 dividend target. For context, Borouge shareholders currently receive 7.94 fils per share, with the next payout scheduled for April.
By ensuring steady dividend growth, the company aims to enhance investor confidence while maintaining a strong financial position.
Strengthening ADNOC’s Global Position
According to Dr. Sultan Al Jaber, ADNOC’s Managing Director and Group CEO, this move reinforces ADNOC’s leadership in the global chemicals market. The acquisition of Nova Chemicals, combined with the Borouge-Borealis merger, aligns with ADNOC’s long-term strategy for diversification and expansion.
Nova Chemicals brings valuable assets to the table, including:
- 2.6 million metric tons of polyethylene production capacity
- 4.2 million metric tons of ethylene capacity
By integrating Nova into its operations, Borouge Group International expands its production capabilities while securing a strong foothold in the North American market. This acquisition ensures long-term profitability and market resilience.
Financial and Strategic Benefits
The merger is expected to generate approximately $500 million in annual synergies, enhancing operational efficiency. Additionally, it provides immediate dividend accretion, benefiting existing Borouge shareholders.
Following the completion of the merger, ADNOC will transfer its stake in Borouge Group International to XRG, its dedicated investment vehicle for natural gas, chemicals, and low-carbon energy solutions. This strategic move aligns with ADNOC’s broader vision for sustainable growth.
Key Milestones and Completion Timeline
The full integration of Borouge, Borealis, and Nova Chemicals is projected to be finalized by Q1 2026. Once completed, Borouge Group International will emerge as a $60+ billion global polyolefins powerhouse.
With this transformative deal, ADNOC is reinforcing its position as a leading force in the petrochemicals industry while advancing Abu Dhabi’s global influence in the energy and chemicals sector.
