Borouge CEO: Insights on the AED 220B merger and future growth

Logo of Borouge Plc

ADNOC and OMV have agreed terms on a binding Framework Agreement for the proposed combination of Borouge and Borealis to form Borouge Group International, and this entity will subsequently acquire Nova Chemicals. The transaction is expected to complete in Q1 2026. Hazeem Sultan Al Suwaidi, Chief Executive Officer of Borouge Plc, explains the significance of the deal for Borouge shareholders.

*What does this transaction mean for Borouge and investors?

- The proposed combination of Borouge and Borealis, and the acquisition of Nova, presents a compelling growth opportunity for investors. This is an exciting and truly transformational deal, combining three leading polyolefin producers into a new company valued at approximately $60 billion. As a result, the Abu Dhabi Securities Exchange will gain an industrial powerhouse.

When we conducted our successful IPO in 2022, we promised to become a global industry leader and to create substantial shareholder value. Having delivered a strong financial performance despite a challenging global market environment, we are now taking a major stride that accelerates our growth and places Borouge on a firm path to success in the years ahead.

*Give us a sense of the scale of this new company?

- Borouge Group International will be the fourth largest petrochemicals company in the world and second largest outside of China, with a nameplate capacity of 13.6 million metric tons across 62 plants in three continents, which is more than double Borouge’s current capacity. Borouge Group International is expected to generate over $7 billion in EBITDA annually and will have a significant presence in North America, Asia, the Middle East and Africa, with a particular focus on the highest growth markets in these regions.

Along with a cash injection of approximately €1.6 billion by OMV into Borouge Group International, the new entity will also acquire Nova for $13.4 billion, further expanding its footprint in North America.

*How will this transaction deliver immediate benefits to shareholders?

- The company will leverage its scale, leading technology, feedstock advantages and worldwide market access to drive efficient growth and deliver attractive returns. Borouge shareholders will own a stake in a company that has a robust financial profile, high margins and strong cash flow generation.  

Building on Borouge’s commitment to deliver shareholder value, Borouge Group International is committing to a 90% dividend payout ratio, with a minimum annual payout of 16.2 fils per share, which today translates into a dividend yield in excess of 6%. 

Moreover, the transaction will deliver on cost and revenue synergies, which have already been identified at $500 million annually, with 75% realised within three years of the deal’s completion.

This will be a highly resilient company that will thrive by grasping new growth opportunities, and is well positioned to capitalise on a cyclical upturn for the global industry.

*What are the growth prospects for Borouge Group International?

- With an expanded global footprint, Borouge Group International will be perfectly positioned to tap into key high-growth customer segments such as sustainable materials, advanced packaging, healthcare, mobility, and construction.

The company will also increase capacity significantly through the completion of the Borouge 4 mega project, delivering an additional production capacity of 1.4 million tonnes per year and contribute a through-the-cycle EBITDA of approximately $900 million. The project is expected to be re-contributed at cost, estimated at $7.5 billion, once it becomes fully operational at the end of 2026.

The newly formed global petrochemical champion will also unlock value through cutting-edge technologies and the collective power of seven world-class innovation centres, which have produced over 16,500 patents. We will also harness a global sales and marketing network to respond to customer trends and demand. This will ensure that Borouge Group International remains at the forefront of the industry’s development and enables an even more differentiated, high-value product offering.

*Are there plans to increase investor participation in Borouge Group International?

- A key part of our strategy is expanding investor access. As part of the transaction, Borouge Group International intends to carry out a $4 billion capital raise in 2026, which is expected to increase the free float and enable even wider participation from investors to be part of the growth journey. With the newly formed entity listed on ADX, we are committed to ensuring that both regional and global investors can participate in the company’s success as it builds on its position as a world leader in the petrochemicals industry.