UAE oil giant ADNOC to buy German chemicals firm for 12 bn euros

German chemicals group Covestro said Tuesday it had accepted a takeover bid from the United Arab Emirates state energy company ADNOC, valuing the plastics-maker at 12 billion euros ($13.3 billion).

The agreement signed between the two groups "stipulates that the bidder will make a public takeover offer for all outstanding shares of Covestro at a price of 62.00 euro per share", Covestro said in a statement.

The takeover offer by the Abu Dhabi National Oil Company (ADNOC) had a "minimum acceptance rate of 50 percent plus one share", Covestro said.

Covestro, which is based in Leverkusen and has expertise in areas such as chemical recycling, has been a key target for ADNOC as it looks to diversify its operations.

It comes as the German chemicals industry has been gripped by crisis since the Russian invasion of Ukraine, which saw supplies of natural gas to Germany slashed and sent energy prices soaring.

The deal remains subject to a set of "closing conditions, including merger control, foreign investment control and EU foreign subsidies clearances", the statement said.

The German group said it "welcomes and supports the bidder's announced takeover offer" and would in all likelihood recommend shareholders accept the terms of the deal.

The takeover talks between the two parties have progressed steadily since they first came to light in September last year.

State oil firm ADNOC is headed by Sultan Al Jaber, who also served as the president of the COP28 climate talks in Dubai last year.