Covestro continues operations after ADNOC acquisition and awaits European Union's decision on the matter
Covestro, a Leverkusen-based plastics company, is currently undergoing an in-depth review of a potential takeover by the Arab oil company Adnoc, initiated by the European Commission (EC). This investigation, launched on July 28, 2025, focuses on whether Adnoc’s state backing, including possible unlimited guarantees from the UAE, provides an unfair competitive advantage under the EU’s Foreign Subsidies Regulation.
The probe is a significant escalation beyond the previous approval given under standard merger rules, and a final decision is expected by December 2, 2025. Despite this investigation, Covestro remains confident that the deal will be completed in the second half of the year as planned.
Covestro's recent quarterly results showed sales that missed expectations, but the company has reiterated its commitment to the Adnoc deal timeline. Shares of the company have remained stable and slightly up, indicating a level of investor confidence.
The focus of Covestro's investment decisions is not solely dependent on the change of government in Germany. Covestro's Chief Financial Officer, Christian Baier, has stated that the company does not see any short-term recovery and expects the takeover to be completed in the second half of the year.
Baier has also expressed pessimism about the business outlook, stating that trade issues have overshadowed any anticipated positive effects in the second half of the year. However, he has called on the German government to strengthen investments in Germany, a call that was reported by Handelsblatt.
The trade agreement between the EU and the USA, as reported by Handelsblatt, has made Covestro a bit more secure, according to Baier. Covestro is currently observing the details of this agreement, but the takeover of Covestro by Adnoc is not directly connected to this agreement.
Covestro's investment strategies are influenced by the details of the EU-USA trade agreement and the government's investment policies in Germany. Baier stated that Covestro would like to invest heavily in Germany, but not blindly and without considering existing investment plans.
The EU Commission initiated the in-depth review of the Adnoc takeover of Covestro due to potential distorting subsidies. Covestro's Chief Financial Officer, Christian Baier, has stated that the EU review has not created any new uncertainty and that constructive talks are still ongoing. Baier does not yet see a fundamental breakthrough in the recent trade agreement between the EU and the USA.
References: [1] Handelsblatt, 2025. "Adnoc's €12 billion takeover of Covestro under scrutiny by EU Commission." [online] Available at: https://www.handelsblatt.com/unternehmen/chemie/adnocs-12-milliarden-uebernahme-von-covestro-unter-aufsicht-der-eu-kommission-12388676.html
[2] Reuters, 2025. "EU Commission launches in-depth probe into Adnoc's takeover of Covestro." [online] Available at: https://www.reuters.com/business/eu-commission-launches-in-depth-probe-adnocs-takeover-covestro-2025-07-28/
[3] Bloomberg, 2025. "Covestro Reiterates Commitment to Adnoc Deal Despite EU Probe." [online] Available at: https://www.bloomberg.com/news/articles/2025-08-03/covestro-reiterates-commitment-to-adnoc-deal-despite-eu-probe
The financial implications of the EU's in-depth review of Adnoc's takeover of Covestro are under scrutiny, as the decision could potentially impact Covestro's business dealings and financial plans. Covestro's Chief Financial Officer, Christian Baier, has maintained that the ongoing investigation is not a source of new uncertainty and that constructive talks are still ongoing.
