Who Owns Covestro Company?

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Who is set to own Covestro?

Understanding a company's ownership is key to its strategic path. Major shifts, like acquisitions, can redefine a company's trajectory. This is currently happening with Covestro, a leader in advanced polymer materials.

Covestro, established in 2015 as a spin-off from Bayer MaterialScience, is a significant player in the polymer industry. With €14.2 billion in revenue for fiscal year 2024 and around 17,500 employees globally by the end of 2024, the company specializes in materials vital for automotive, construction, and electronics sectors. Its product portfolio includes innovative solutions like those analyzed in the Covestro BCG Matrix.

The company's ownership is currently held by institutional investors, but this is changing. The Abu Dhabi National Oil Company (ADNOC) has made a significant takeover bid, which, if successful, will mark a substantial ownership transition for Covestro.

Covestro's ownership journey began not with individual founders, but through a significant corporate restructuring. It emerged as an independent entity from Bayer AG's MaterialScience business unit on September 1, 2015. This strategic separation laid the groundwork for Covestro's distinct identity in the high-tech polymer materials market.

Corporate Spin-off Genesis

Covestro was established through the spin-off of Bayer AG's MaterialScience business. This move allowed the new company to focus exclusively on advanced polymer materials.

Initial Public Offering (IPO)

The company went public on the Frankfurt Stock Exchange on October 6, 2015. This event marked a significant step towards Covestro's independent Covestro ownership structure.

Bayer AG's Majority Stake

Following its IPO, Bayer AG retained a substantial majority stake, holding approximately 69% of Covestro's shares. This initial holding underscored Bayer's role as the primary shareholder.

Gradual Divestment by Bayer

Bayer AG progressively reduced its ownership over time. By May 2018, Bayer had completed the sale of its direct stake, though its pension fund maintained a 6.8% holding.

Absence of Traditional Founders

Unlike typical startups, Covestro did not have a founding team with initial equity splits. The driving force was the strategic vision for a specialized, independent materials science company.

Focus on Specialization

The early ownership structure was shaped by the goal of separating the high-tech polymer materials business from Bayer's life sciences operations. This allowed for a dedicated focus on innovation in its specific market.

The early ownership of Covestro was predominantly defined by Bayer AG's significant initial stake and its subsequent, phased divestment. This process allowed Covestro to establish its independence and pursue its strategic objectives in the advanced materials sector, aligning with its Target Market of Covestro.

Key Ownership Milestones

Covestro's initial ownership was characterized by Bayer AG's substantial influence, which gradually diminished through strategic sales. This transition facilitated Covestro's establishment as a publicly traded entity focused on specialized polymer materials.

• Covestro became an independent company on September 1, 2015.
• Bayer AG held approximately 69% of Covestro shares post-IPO on October 6, 2015.
• Bayer AG completed its direct stake sale by May 2018.
• Bayer's pension fund retained a 6.8% stake as of May 2018.
• No public information exists regarding individual founders' equity splits.

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The ownership journey of Covestro began with its spin-off from Bayer AG, which subsequently divested its entire stake by May 2018. This marked the initial phase of establishing a diversified shareholder base, primarily consisting of institutional investors.

The current landscape of Covestro ownership is significantly shaped by the pending acquisition by the Abu Dhabi National Oil Company (ADNOC). As of late 2024, ADNOC had secured acceptances for 81.77% of Covestro shares through its subsidiary XRG, in addition to its direct holdings and instrument-based stakes, bringing its total ownership to over 95.02%. This transaction, valued at €14.7 billion with a bid of €62 per share, is anticipated to conclude in the latter half of 2025, contingent on regulatory approvals. The European Commission's in-depth investigation, initiated in July 2025, focuses on potential market distortions from foreign subsidies, with a decision expected by December 2, 2025. This move positions ADNOC as the controlling entity, integrating Covestro into its performance materials and specialty chemicals business to advance its 'Sustainable Future' strategy. While ADNOC is set to be the dominant owner, other significant institutional investors as of July 2025 include Barclays Bank Plc, UBS Asset Management (UK) Ltd., and Silchester International Investors LLP, holding smaller, but notable, percentages of Covestro stock.

Key Ownership Developments

Covestro's ownership structure has seen a major shift with ADNOC's acquisition. This transition from a publicly traded company with diverse institutional investors to a majority-owned entity by a state-owned enterprise has significant implications.

• ADNOC announced its acquisition deal for Covestro on October 1, 2024.
• By December 16, 2024, ADNOC's total ownership, including accepted offers, reached 95.02%.
• The acquisition is expected to finalize in the second half of 2025.
• The European Commission is investigating the deal for potential market distortions.
• ADNOC aims to leverage Covestro for its Performance Materials and Specialty Chemicals business.

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As of early 2025, Covestro's governance is structured with a Supervisory Board and a Board of Management. The Supervisory Board, comprising 12 members, is equally split between shareholder and employee representatives, with Dr. Richard Pott serving as its Chairman. The Board of Management, responsible for the company's day-to-day operations, includes Dr. Markus Steilemann as CEO, Christian Baier as CFO, Dr. Thorsten Dreier as CTO/Labor Director, and Monique Buch as CCO as of June 1, 2025.

Covestro operates under a strict one-share-one-vote principle for its ordinary shares, ensuring that voting power is directly proportional to share ownership. There are no indications of dual-class shares or special voting rights that could dilute this principle. Shareholders are obligated to report any changes in their voting stake that cross specific thresholds, including 3%, 5%, 10%, 15%, 20%, 25%, 30%, 50%, and 75%, to both Covestro and the German federal financial supervisory agency. While significant public proxy battles have not been a feature of Covestro's history, institutional investors have actively engaged with the company on critical issues such as sustainability and strategic development. The pending acquisition by ADNOC, which has already secured acceptances for over 95% of Covestro's outstanding shares, is set to consolidate significant control. However, this acquisition is still subject to regulatory approvals, with the European Commission currently investigating potential impacts from foreign subsidies. This investigation underscores the careful scrutiny applied to major ownership changes and their implications for market dynamics, a topic also explored in a Brief History of Covestro.

Understanding Covestro's Shareholder Landscape

The ownership structure of Covestro is evolving, with a significant shift anticipated due to a pending acquisition. Understanding these changes is crucial for investors and stakeholders.

• Covestro adheres to a one-share-one-vote system.
• Shareholder voting power is directly tied to shareholdings.
• Institutional investors play an active role in company governance.
• A pending acquisition by ADNOC aims to consolidate majority control.

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The ownership landscape of Covestro has seen a dramatic shift over the past few years, culminating in a significant acquisition that is reshaping its corporate structure and strategic direction.

The most impactful recent development in Covestro's ownership profile is the ongoing acquisition by the Abu Dhabi National Oil Company (ADNOC). This transaction, valued at €14.7 billion with an offer of €62 per share, has seen ADNOC secure commitments for over 91% of Covestro's shares by December 2024. While the deal is expected to finalize in the latter half of 2025, it is currently under an in-depth investigation by the European Commission, launched in July 2025, to assess the impact of potential foreign subsidies from the UAE on the EU internal market. Despite this regulatory scrutiny, Covestro's CFO expressed confidence in the transaction's completion by year-end. This move signifies a major shift from a broadly institutionally-owned public entity to a company under the control of a corporate parent, aligning with industry trends of consolidation. The acquisition is anticipated to bolster Covestro's 'Sustainable Future' strategy, with ADNOC planning a €1.17 billion capital increase specifically for sustainability initiatives, including climate-neutral production.

ADNOC's Strategic Interest

ADNOC's acquisition of Covestro is poised to integrate the latter into its performance materials and specialty chemicals business. This strategic alignment aims to leverage Covestro's expertise to drive growth and innovation within ADNOC's broader portfolio.

Sustainability Focus Post-Acquisition

A key aspect of the acquisition is ADNOC's commitment to investing in Covestro's sustainability goals. The planned capital increase will directly support projects focused on climate-neutral production and other environmental initiatives.

Share Buyback Activity

Prior to the ADNOC acquisition, Covestro engaged in a share buyback program between March 2022 and June 2023. This program saw the repurchase of approximately 4.7 million shares, indicating a focus on shareholder returns during that period.

Regulatory Oversight

The European Commission's investigation into the ADNOC acquisition highlights the increasing scrutiny on cross-border M&A activities involving state-backed entities. This process is crucial for ensuring fair competition within the EU market.

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