Covestro AG: Completion of ADNOC Takeover and Strategic Implications
Covestro AG has finalized a takeover by XRG P.J.S.C., the rebranded entity of ADNOC International. The transaction, completed in early December 2025, resulted in ADNOC acquiring a 95.1 % stake, reducing free float to below five percent. The agreed capital increase of €1.17 billion has been executed to fund the “Sustainable Future” strategy.
The takeover has effectively ended the public trading of Covestro shares. The final closing price, which determines the compensation for the remaining minority shareholders, has yet to be announced. Until the closing, the stock functions as an arbitrage instrument with limited upside potential, its value primarily tied to the announced takeover price.
Covestro’s operational performance remains challenging. The company’s core businesses—polymers, high‑performance plastics, coatings, adhesives, insulating materials, sealants, polycarbonates, and polyurethanes—continue to face competitive pressure, particularly in the automotive and construction sectors. Nevertheless, the acquisition by ADNOC is expected to provide the necessary capital and strategic support to advance sustainability initiatives, in line with ADNOC’s global focus on renewable and low‑carbon materials.
Market observers note that the takeover may create a window for Covestro’s product portfolio to benefit from ADNOC’s extensive upstream resources and global reach. However, the immediate impact on the company’s valuation remains limited, as the stock’s value will be fully determined only after the final settlement with remaining shareholders.
The German chemical sector, already under strain from increased imports from China and the United States, may experience further consolidation. Covestro’s absorption into ADNOC could signal a broader trend of international investment in European specialty chemicals, potentially reshaping the competitive landscape in the coming years.
