Mubadala sells major stake in Austria’s Borealis to OMV

By Backend Office, Desk Reporter
Borealis AG
Representational Image

Abu Dhabi-based investment firm Mubadala Investment Company (Mubadala) has sold 39 percent of its stake in the Austrian chemical company Borealis to regional integrated oil and gas company OMV. 

According to the terms of the deal which was initially announced in March 2020, OMV will now hold 75 percent interest in Borealis with Mubadala retaining a 25 percent interest.

The deal will make the Vienna-based OMV and Borealis the number 1 producer of ethylene and propylene in Europe and one of the top 10 polyolefin producers worldwide.

Borealis, a leading provider of polyolefins, base chemicals, and fertilizers currently employs more than 6,800 employees and operates in over 120 countries. The firm serves its customers both directly and in collaboration with Borouge, a joint venture with the Abu Dhabi National Oil Company (ADNOC) and with Baystar, a joint venture with Total in Texas, USA.

The chemical company made a worldwide total sales of $11.49 billion with a net profit of $1.03 billion in 2019.

Strategic Importance 

The global demand for monomers and polymers is growing rapidly, a controlling majority in Borealis will make OMV a leading provider of polyolefins and base chemicals. The acquisition is a strategic diversification of OMV’s value chain into high-value chemicals.

OMV and Borealis are also expected to jointly expand their know-how and activities in the field of the circular economy. Borealis’ activities in plastic recycling, such as recycling plants EcoPlast (Austria) and mtm plastics (Germany), Project STOP (Ocean Waste) and the Design For Recycling (DFR) initiative are a perfect addition to OMV’s ReOil technology for chemical recycling of post-consumer-plastic to synthetic crude.

Musabbeh Al Kaabi
Musabbeh Al Kaabi
CEO – Petroleum & Petrochemicals

“This transaction is well aligned with our strategy as a responsible investor and we are confident in the value this partnership will create for all three companies. Both OMV and Borealis are champions of the Mubadala portfolio, and this decision is consistent with our asset management model and our commitment to our partners. We are aligned with OMV’s strategy to expand their value chain and support their growth in the chemicals space globally.”

Rainer Seele, Chairman of the OMV Executive Board and CEO, said, “This transaction is another milestone in the implementation of our strategy. We are thus establishing an integrated and sustainable business model extending OMV’s value chain towards higher-value chemical products and recycling, thereby repositioning the Group for a lower carbon future.”