Abu Dhabi National Oil Company (ADNOC) has terminated talks to buy a controlling stake in Braskem, the Brazilian petrochemical producer said on Monday, driving its shares down almost 15%.
ADNOC presented a non-binding offer in November for the Braskem stake held by conglomerate Novonor, with an implied price of 37.29 reais per share for an equity value of 10.5 billion reais ($2.1 billion).
However, ADNOC has now informed Novonor about its decision not to go forward with the negotiations, Braskem said in a securities filing.
Braskem's Sao Paulo-traded shares dropped as much as 16.3% on Monday to its lowest level since February, before trimming some losses. The company was the biggest loser on Brazil's benchmark Bovespa Index, which was up 0.3%.
"ADNOC was the most vocal about a transaction with Novonor regarding Braskem and had advanced in the due diligence process, therefore the fallout could lead to disappointment in the market," Santander analysts said in a note to clients.
Brazil's Unipar Carbocloro and J&F were amongother bidders for Braskem.
Petrochemical Industries Corp, a subsidiary of Kuwait Petroleum Corp, also was mulling a potential bid, local newspaper Valor Economico had previously reported.
Novonor, formerly known as Odebrecht, holds a 38.3% controlling stake in the petrochemical firm, which it has long been looking to sell as part of a broader restructuring.
State-run oil giant Petrobras is also a major Braskem shareholder.