It appears that the merger between Borealis and Borouge, which would have created an international petrochemical giant with sales of $30 billion, has hit a roadblock. The “Edelweiss” project, scheduled for completion in September 2023, was initially seen as promising from an industrial perspective. The involvement of partially state-owned OMV in a larger entity made sense, with the state holding company ÖBAG negotiating the Austrian terms. The deal aimed to keep the headquarters in Austria, along with research and development, and a second stock exchange listing in Vienna.
However, recent developments have caused significant displeasure among Austrian stakeholders. The shift of OMV shares from Mubadala to Adnoc last year changed the dynamics of negotiations, with Adnoc taking a more assertive and aggressive approach. This change in tone has raised concerns about how Austria is being treated as a partner in the merger.
As a result, the future of the deal now hangs in the balance. Adnoc and OMV are struggling to reach consensus on key aspects like valuation and control. Al Jaber is closely monitoring negotiations with OMV under pressure to make the merger succeed.
Speculation about potential delays beyond the National Council elections has been dismissed by both sides. Despite these challenges, both OMV and Adnoc continue to negotiate in good faith to find a solution that works for their shareholders and employees.
The outcome of these discussions will determine whether or not the proposed merger goes through.
