OMV and Mubadala Complete Borealis Transaction
- OMV acquired additional 39% stake from Mubadala, increasing its shareholding in Borealis to 75%
- Purchase price of USD 4.68 billion
- Mubadala retains a 25% interest in Borealis
Abu Dhabi, Vienna:
Mubadala Investment Company, the Abu Dhabi-based strategic investment company, and OMV, the international integrated oil and gas company headquartered in Vienna, have today completed the transaction for OMV to acquire an additional 39% stake in Borealis, a leading, global chemical company, from Mubadala.
Following the initial agreement announced in March this year, the transaction was completed in line with the expected timeline and in accordance with all the regulatory requirements. OMV now holds a 75% interest in Borealis and Mubadala retains a 25% interest in the company.
OMV is entitled to all dividends in relation to the additional shares in Borealis distributed after December 31, 2019. OMV will fully consolidate the results of Borealis in its financial statements. In 2019, Borealis generated worldwide total sales of EUR 9.8 bn and a net profit of EUR 872 mn.
Musabbeh Al Kaabi, CEO, Petroleum & Petrochemicals, Mubadala Investment Company: “This transaction is well aligned with our strategy as a responsible investor and we are confident in the value this partnership will create for all three companies. Both OMV and Borealis are champions of the Mubadala portfolio, and this decision is consistent with our asset management model and our commitment to our partners. We are aligned with OMV’s strategy to expand their value chain and support their growth in the chemicals space globally.”
Rainer Seele, Chairman of the OMV Executive Board and CEO: “This transaction is another milestone in the implementation of our strategy. We are thus establishing an integrated and sustainable business model extending OMV’s value chain towards higher value chemical products and recycling, thereby repositioning the Group for a lower carbon future.”
With its head office in Vienna, Austria, Borealis currently has more than 6,800 employees and operates in over 120 countries. The company provides services and products to customers globally, both directly and in collaboration with Borouge, a joint venture with the Abu Dhabi National Oil Company (ADNOC) and with Baystar™, a joint venture with Total in Texas, USA.
The global demand for monomers and polymers is growing rapidly. Obtaining a controlling majority in Borealis makes OMV a leading provider of polyolefins and base chemicals. The joint production capacities make OMV and Borealis the number 1 producer of ethylene and propylene in Europe and one of the top 10 polyolefin producers worldwide. The acquisition is a strategic extension of OMV’s value chain into high value chemicals. This provides a natural hedge against the cyclicality of each value chain step with respect to both volumes and market spreads, de-risking OMV’s exposure to volatile markets.
In addition, OMV and Borealis will jointly expand their know-how and activities in the field of circular economy. Borealis’ activities in plastic recycling, such as recycling plants EcoPlast (Austria) and mtm plastics (Germany), Project STOP (Ocean Waste) and the Design For Recycling (DFR) initiative are a perfect addition to OMV’s ReOil technology for chemical recycling of post-consumer-plastic to synthetic crude.