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2025-07-31 22:21:35
[EU launches in-depth investigation into subsidy dispute involving €14.7 billion acquisition of German chemical giant Covestro] The European Commission recently announced the launch of an in-depth investigation into the Abu Dhabi National Oil Company (ADNOC) of the United Arab Emirates' €14.7 billion acquisition of German chemical giant Covestro, citing concerns that subsidies provided by the UAE may distort competition in the EU's internal market. Last October, ADNOC reached a deal to acquire Covestro, its largest acquisition ever. The investigation is based on the Foreign Subsidies Regulation (FSR), and a preliminary review that began in May of this year showed that ADNOC was very likely to have received "foreign subsidies" from the UAE government. Such subsidies enable it to propose valuations and financial terms that do not meet market conditions, resulting in other potential investors without subsidies being unable to compete fairly with it. Possible "foreign subsidies" include unlimited guarantees from the UAE and ADNOC's commitment to increase capital in Covestro.
