New Delhi, Dec 10 (PTI) Fair trade regulator CCI on Tuesday said it has approved Abu Dhabi National Oil Company's (ADNOC) proposal to acquire Covestro for USD 16.4 billion.

Abu Dhabi's state-owned oil firm ADNOC is an energy and petrochemicals group.

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"The proposed transaction relates to the acquisition of up to 100 per cent of the share capital of Covestro AG by ADNOC PJSC, ADNOC International Ltd and ADNOC International Germany Holding AG (ADNOC Germany) by way of an all-cash voluntary public takeover offer to all Covestro shareholders.

"Upon closing of the public takeover, ADNOC Germany will additionally subscribe to 1.89 crore new shares in Covestro, corresponding to 10 per cent of Covestro's current share capital, by means of a capital increase against cash consideration with the exclusion of subscription rights of any remaining minority shareholders of Covestro," the Competition Commission of India (CCI) said in a release.

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The company runs its India operations through Covestro (India) Pvt Ltd.

Covestro is a chemical producer that focuses on the supply of high-performance polymer materials and solutions.

In October this year, Covestro announced that it had signed an investment agreement with certain entities of the ADNOC Group.

The agreement stipulates, among other items, that the bidder will make a public takeover offer for all outstanding shares of Covestro.

In addition, upon completion of the transaction, the company's share capital will be increased by 10 per cent, under simplified exclusion of subscription rights.

The deals beyond a certain threshold require approval from the regulator, which keeps a tab on unfair business practices as well as promotes fair competition in the marketplace.

(The above story is verified and authored by Press Trust of India (PTI) staff. PTI, India’s premier news agency, employs more than 400 journalists and 500 stringers to cover almost every district and small town in India.. The views appearing in the above post do not reflect the opinions of LatestLY)