Covestro (1COV) Investor Update summary

Strategic partnership and transaction overview

• Signed investment agreement with ADNOC, which will launch a voluntary public takeover offer at €62 per share, a 54% premium to the unaffected price, for all outstanding shares, valuing the company at approximately €11.7 billion.

• ADNOC will subscribe to a 10% capital increase at the offer price, providing €1.17 billion in proceeds to support strategic initiatives and Covestro's "Sustainable Future" strategy.

• The offer is subject to a minimum acceptance rate of 50% plus one share and customary regulatory approvals, with closing anticipated in H2 2025.

• No sale, closure, or significant reduction of business activities is planned; operational management and strategic direction remain unchanged.

• Both Boards of Management and Supervisory Board support the agreement and intend to recommend acceptance to shareholders.

Governance, employee, and legal commitments

• Company will retain its German stock corporation status, headquarters in Leverkusen, and co-determined Supervisory Board, with ADNOC receiving 4 out of 12 Supervisory Board seats.

• Two independent Supervisory Board members will remain post-transaction; no domination or profit and loss transfer agreement during the investment agreement period (until end of 2028).

• Employee interests are protected, with recognition of existing works agreements, collective bargaining, and works council rights in Germany.

• Intellectual property will be protected, with no transfer to ADNOC or third parties.

• Disputes under the agreement will be settled by arbitration.

Transaction process and regulatory timeline

• Offer document expected within six weeks, followed by a four to five week initial acceptance period, and a two-week additional acceptance period if the threshold is met.

• Closing is anticipated in H2 2025, pending regulatory approvals in the EU, US, China, and other key jurisdictions.

• Proceeds from the capital increase will be used to advance strategic priorities; dividend payments are suspended until closing.

• The Investment Agreement is set to run until December 31, 2028.

• ADNOC may consider delisting or a squeeze-out post-transaction, with board support in principle.