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LONDON, Dec 21 (Reuters Breakingviews) – The United Arab Emirates appears to have struck itself a deal worth $4 billion.ADNOC Wednesday acquired 25% stake in $16 billion Austrian oil group OMV (OMVV.VI) Mubadala, a wealth fund from the United Arab Emirates. Financial details were not disclosed. But in terms of valuation, it doesn’t matter whether an Emirati state entity gets a better deal because the deal just moves assets from one pocket to another.
However, the deal is yet another move in ADNOC’s long-term strategy. strategyDeparture November 28. UAE wants to pump more oil, the list its natural gas business.But it also wants to sharpen its focus on petrochemicals, which forecaster It has long been highlighted for its growth potential. As European industry groans under high energy costs, there is also an opportunity to deploy petrochemical company Borealis, where ADNOC have 25% of the shares, taking away their domestic market share.
ADNOC’s new stake in OMV, which owns 75% of Borealis, gives it greater control over these targets.This is especially convenient since Borealis also owns shares in Borouge (Borouge.AD), a producer of more sustainable plastics, recently went public at a $20 billion valuation. At some point, ADNOC may consider using this leverage to bring these disparate chemicals businesses closer together. (George Hay)
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Edited by Lisa Jucca and Streisand Neto
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