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Source: EU regulators to pause probe of ADNOC Covestro deal.

A person with first-hand knowledge of the situation said that EU antitrust regulators will pause their investigation on Wednesday into Abu Dhabi's state oil giant ADNOC’s bid for German chemicals firm Covestro. The bid is worth 14.7 billion euros ($17.2 billion).

According to the person, the temporary suspension will allow the European Commission time to gather more information about the deal.

ADNOC bought Covestro in October last year, making it its largest acquisition to date and the biggest foreign takeover of an EU firm by a Gulf State. Covestro produces foam chemicals that are used in car seats, mattresses and building insulation.

ADNOC and the EU Competition enforcer had constructive discussions on potential remedies with ADNOC on Tuesday, a source reported.

The Commission began an investigation in July and warned about possible subsidies given by the United Arab Emirates. This included an unlimited guarantee, as well as an increase of capital by ADNOC to Covestro.

ADNOC declined comment. The Commission has set December 2, 2012 as the deadline for a decision. It did not respond immediately to an email request for comments.

(source: Reuters)