Germany’s BASF has approached rival chemical group Evonik and its largest shareholder, the RAG Foundation, over a possible transaction that could reshape Europe’s chemical industry.
The discussions, reported on Friday, September 25, come as European chemical manufacturers face weaker demand and elevated energy costs. A source familiar with the matter confirmed to Reuters that BASF and Evonik are in contact over a possible deal, while both companies declined to comment on the reports.
Evonik’s shares rose about 7% following the reports, while BASF shares fell around 3% during trading. Evonik has a market capitalisation of roughly €8.4 billion and an enterprise value of about €12 billion, including net debt.
The RAG Foundation, which owns around 43% of Evonik, would play a crucial role in any potential transaction.
A combination of the two companies would bring together businesses with combined annual revenues of about €74 billion, potentially creating a larger German chemical group capable of competing more strongly with major Chinese and US rivals.
The development comes shortly after Evonik announced another phase of its restructuring programme, including plans to divest two businesses as it concentrates on its core operations.
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