Abu Dhabi National Oil Co. (Adnoc), the biggest oil producer in the United Arab Emirates, has dropped its bid to acquire a stake in Brazil's Braskem SA, according to a statement from Braskem reported by Bloomberg News. Adnoc informed Novonor SA, Braskem's main shareholder, that it was no longer interested in continuing negotiations to buy a stake in the Latin American petrochemicals giant.
The decision represents a setback for Adnoc's ambitions to build a global chemicals business and diversify beyond just producing crude oil and refined products. Bloomberg reports that Adnoc had made a non-binding $2.1 billion offer for a stake in Braskem and proposed sharing control with Brazil's Petrobras, similar to Novonor's current arrangement. However, issues like valuation appear to have derailed the deal.
For Novonor, the failed sale process is another delay in its efforts to sell the Braskem stake to appease creditors after years of trying. Meanwhile, Adnoc's pursuit of other major chemical deals like acquiring Germany's Covestro AG and merging two plastics units into a $30 billion business have also hit roadblocks over valuation disagreements, according to the Bloomberg article.