Private equity firm Lone Star has entered a deal to buy BASF’s construction chemicals business for 3.17 billion euros ($3.5 billion) on a cash and debt-free basis, the German chemicals company said on Saturday as it seeks to focus on more profitable operations.
The deal, which has immediate effect upon BASF’s reporting, is expected to close in the third quarter of 2020, according to the statement.
Reuters reported last month that Lone Star was in negotiations to buy the BASF unit.
The private equity firm vied with a consortium comprising buyout groups Cinven – which owns peer Chryso – and Bain for the world’s largest maker of chemical additives for concrete, sources told Reuters in November.
Lone Star had previously walked away from the bidding but was invited back to the negotiating table.
BASF’s construction chemicals unit is the world’s largest maker of additives for concrete. It also offers a range of substances including concrete repair fillers, grouts and sealants under a business dubbed Construction Systems, where BASF is the No. 4 player globally.
BASF purchased the construction chemicals business from Degussa in 2006 for 2.7 billion euros including debt.
By Kanishka Singh
Source: Reuters
The separation is expected to be completed by early Q3, following the receipt of all relevant approvals, including final Board approval. Nouryon intends to reduce its own debt with proceeds received from a planned external financing by Nobian.
Trinseo became a producer of the resin when it acquired Arkema’s PMMA business. It announced that it closed on the €1.14bn deal earlier this month.
As part of the EU’s Single-Use Plastic Directive (SUPD), it will become mandatory for caps and lids to remain attached to all beverage containers up to three liters in capacity from 2024.
