No cause for concern.
In an interview with Handelsblatt, Covestro's Chief Financial Officer, Christian Baier, discussed the ongoing investigation by the European Commission into the acquisition of Covestro by Adnoc.
Baier emphasized the importance of the concrete details of the agreements, advising calmness regarding the time it may take for all competition authorities to give the green light for the takeover. He expressed optimism that the deal can be completed in the second half of the year, but acknowledged that the EU's deeper review adds regulatory scrutiny and may affect timing.
The EU Commission initiated a deeper investigation of the Covestro-Adnoc deal due to possible distorting subsidies. Specifically, the Commission identified "preliminary concerns" that subsidies granted by the UAE might have allowed Adnoc to buy Covestro on terms that distort the EU internal market. The investigation can result in a no-objection decision, acceptance of remedies, or prohibition of the deal.
Despite the in-depth probe launched in late July 2025, Covestro continues constructive discussions with the Commission and expects the takeover to complete in the second half of the year. If the deal goes through, Covestro shareholders can probably expect to receive 62.00 euros per share in the course of the second half of the year.
Baier did not express optimism about a short-term recovery for Covestro's business, citing disappointing quarterly figures as a reason for his caution. However, he stated that they had anticipated the deeper review and that the review has not created any new uncertainty.
The stock price of Covestro dipped slightly following the news of the deeper review, but Baier believes that the trade agreement between the EU and the US has made Covestro somewhat safer. He did not consider the recent trade agreement to be a turning point, though.
In conclusion, while the deeper EU review adds regulatory scrutiny and may affect timing, current statements indicate the transaction is still expected to complete within 2025 unless the Commission issues a blocking decision, which remains uncertain until the investigation concludes in December. The focus remains on the deeper review of Covestro's acquisition by Adnoc by the EU competition authority.
The ongoing investigation by the European Commission into the acquisition of Covestro by Adnoc raises concerns about potential distorting subsidies within the finance industry. The EU Commission's deeper investigation may affect the timing of the business transaction between Covestro and Adnoc, but Covestro's Chief Financial Officer, Christian Baier, remains optimistic about completing the deal in the second half of the year.
