EU investigates ADNOC’s bid for Covestro
Brussels raises concerns about UAE state aid possibly distorting the internal market; decision expected by December.
The European Commission has opened an in-depth investigation into ADNOC’s €14.7 billion acquisition of German chemical giant Covestro, raising concerns that state subsidies from the United Arab Emirates (UAE) may distort competition within the EU’s single market.
The probe, launched on Monday, puts the largest-ever foreign acquisition by Abu Dhabi National Oil Company (ADNOC) under scrutiny. The deal, struck in October 2024, marked one of the most high-profile takeovers of an EU company by a Gulf-based entity.
According to the Commission, the investigation will assess whether financial support from the UAE, including an unlimited state guarantee and a committed capital injection from ADNOC into Covestro, gives ADNOC an unfair advantage, as reported by Reuters. The process is under the EU’s Foreign Subsidies Regulation (FSR).
The Commission will also examine the potential negative impacts on the EU internal market once the merger is completed and the combined company begins operations.
ADNOC pushed back against the Commission’s initial assessment, saying it disagreed with the preliminary findings and expressed confidence that a full review would clear the transaction. Covestro also confirmed it is working cooperatively with EU authorities to move the deal forward. The Commission has set December 2 as the deadline for its final decision.
