Covestro's Stock Market Exit Accelerates Amid Sector Downturn

Covestro faces delisting as majority owner XRG triggers squeeze-out. The chemical firm posted a €644M loss in 2025, with a key shareholder vote scheduled for May 2026.

The final act of Covestro's public market story is now underway. The Leverkusen-based polymer manufacturer is moving toward delisting after its majority shareholder crossed a critical ownership threshold, initiating a mandatory squeeze-out process. This comes as the company navigates a severe industry crisis, though its share price has become detached from these operational challenges.

Shareholder Vote to Seal Delisting Fate

International investment vehicle XRG, founded in November 2024 to focus on low-carbon energy and chemical investments, has surpassed the 95% ownership mark in Covestro. This has triggered a formal squeeze-out procedure to acquire the remaining minority shares. An independent appraiser is currently determining a fair cash compensation value for these shareholders.

A decisive vote is scheduled for the Annual General Meeting on May 19, 2026. Following approval and subsequent entry in the commercial register, all outstanding shares will automatically transfer to XRG. The withdrawal from public markets is already progressing. Since early February, Covestro's listing has been downgraded from the Prime Standard to the General Standard, with its full regulated market admission set to terminate after May 5. The acquisition by XRG's parent company, Abu Dhabi's ADNOC, represents its largest takeover to date.

2025 Financials Reflect Deep Industry Crisis

The company's latest annual results underscore the intense pressure facing the chemical sector. Group revenue declined by 8.7% to €12.9 billion. EBITDA experienced a more severe contraction, plummeting almost 31% to €740 million.

Cash flow figures were particularly stark, with Free Operating Cash Flow falling to negative €283 million. The bottom line showed a consolidated net loss of €644 million for the year.

Management cited falling selling prices, adverse currency effects, and structural overcapacity coupled with persistently low utilization rates as primary drivers. For the fourth consecutive year, no dividend will be paid; the last distribution to shareholders occurred in 2021. The Performance Materials segment saw revenues drop by 12.1% to €6.1 billion.

Strategic Shifts and Executive Changes

Despite operational headwinds, Covestro is implementing structural countermeasures. Its STRONG cost-saving program has delivered approximately €275 million in savings by the end of 2025, with an annual target of €400 million by 2028.

In a strategic expansion move, the company plans to acquire two production sites for HDI derivatives from Vencorex, located in Thailand and Texas. This transaction is expected to be finalized in the first half of 2026.

These developments coincide with a pending leadership transition. CEO Markus Steilemann has announced he will not seek a contract extension, with his mandate running until May 2028. CFO Christian Baier will depart the company in September. The supervisory board now faces the task of filling both key executive positions.

Share Price Driven by Compensation Expectations

Covestro's share price has remained stable near its 52-week high. This divergence from weak fundamental performance has a straightforward explanation: the equity is no longer trading on business results but is solely reflecting the anticipated cash compensation from the impending squeeze-out.

For remaining minority shareholders, only one metric now holds relevance—the final compensation amount determined by the independent appraiser. The vote on May 19, 2026, will effectively close the final chapter in the stock market history of this former Bayer subsidiary.