Abu Dhabi National Oil Company (ADNOC) and OMV Aktiengesellschaft have announced significant progress towards the formation of Borouge Group International AG, a global chemicals powerhouse. The companies anticipate the completion of this mega-merger by the end of March 2026, marking a pivotal step in consolidating their chemical operations.
The formation of Borouge Group International AG involves the combination of Borouge Plc and Borealis, along with the acquisition of Nova Chemicals. This strategic move is progressing as planned, with the transaction close expected by the end of March 2026, subject to customary conditions.
A key development is the signing of an Asset Usage Agreement for the Borouge 4 (B4) production complex. This agreement allows Borouge Plc, and subsequently Borouge Group International AG, to operate and market volumes from B4 in return for an at-cost asset utilization fee. B4 is a new integrated polyolefins production complex with significant ethane cracker and polyethylene capacity, utilizing advanced Borstar® technology. The agreement is projected to deliver approximately $400 million in cumulative net profit over the next three years and contribute around 10% annual earnings accretion to Borouge Plc post-ramp-up.
Upon completion, Borouge Group International AG will have access to 13.6 million tonnes of nameplate production capacity across Europe, the Middle East, and North America. This positions the company as the world’s fourth-largest polyolefins producer, benefiting from a geographically diversified platform and a robust capital structure expected to receive strong investment-grade ratings from S&P, Moody’s, and Fitch.
ADNOC’s stake in Borouge Group International will be transferred to XRG, a wholly owned subsidiary, resulting in equal 50% ownership between XRG and OMV. While Borouge Group International AG will be privately held until a future equity raise, Borouge Plc shares will remain listed on the Abu Dhabi Securities Exchange. A temporary adjustment to dividend payments for the financial year 2026 has been agreed upon to strengthen the balance sheet of Borouge Group International AG, with the second dividend tranche limited to 50% of the previously estimated amount. Borouge Plc shareholders will continue to benefit from a minimum dividend commitment of 16.2 fils per share.