Mar 2 2006
BASF Aktiengesellschaft, Ludwigshafen, reached an agreement with Degussa AG, Düsseldorf, to acquire Degussa’s construction chemicals business. The purchase price for equity is just under €2.2 billion. As a result, the transaction value for BASF is €2.7 billion. The transaction, which still requires approval from the relevant authorities, is expected to close by the middle of 2006.
“Degussa’s construction chemicals unit has an excellent position in the industry and offers BASF an attractive means of forward integration in its existing value chain in construction chemicals,” said Dr. Andreas Kreimeyer, member of the Board of Executive Directors of BASF Aktiengesellschaft, responsible for the Performance Products segment. “The acquisition allows us to tap into the growth potential of the construction chemicals market on a sustainable basis and will further expand our position in this high-yield industry.”
The global construction chemicals market is valued at around €13 billion and is attractive in view of annual growth of about 4 to 5 percent, relatively stable margins and high potential for innovation. The acquisition of Degussa’s business will give BASF rapid access to additional industrial customers and end-users. BASF’s strong presence in Asia will additionally generate interesting growth opportunities in this region’s booming construction sector.
By combining its own chemical expertise with Degussa’s know-how in construction chemicals applications, BASF will provide its customers with innovation at the highest level and help them to be more successful in the competitive construction sector. “We rely on the expertise of the employees at Degussa construction chemicals as well as our existing workforce, and are looking forward to forming the best team in the construction chemicals industry,” said Kreimeyer.