Abu Dhabi and OMV in talks to form chemicals giant – source

(Reuters) -Abu Dhabi is discussing with Austria’s OMV the combination of two major chemicals and plastics companies in which they have interests, a source familiar with the matter told Reuters on Tuesday, in a deal that would create a group worth tens of billions of dollars.

State-run Abu Dhabi National Oil Co (ADNOC) owns 25% of Austrian oil and gas company OMV, which has a stake in Borealis, and which in turn has a stake in Borouge.

The two parties are discussing a possible Borealis valuation of about $10 billion, including its Borouge stake, Bloomberg earlier reported, adding that the overall valuation of the combined entity could ultimately exceed $30 billion.

The owners are discussing the potential valuation and ownership structure of a combined entity and may reach the broad outlines for formal merger negotiations in the coming weeks, the report added.

OMV’s CEO told Reuters last month that the company is not planning on selling its majority stake in the petrochemicals subsidiary Borealis.

ADNOC and OMV declined to comment on the matter. Borealis had no immediate response to an emailed request for comment.

(Reporting by Shivani Tanna in Bengaluru and Alexandra Schwarz-Goerlich in Vienna; Editing by David Goodman and David Holmes)