Evonik rejects BASF takeover offer

The chemical company Evonik has rejected a takeover offer from rival BASF. This is reported by the “Handelsblatt” and the Reuters news agency. BASF therefore offered around 22.15 euros per Evonik share. The offer corresponds to a premium of a good 28 percent on the Evonik share price before the first takeover speculation last week.

Both companies confirmed exploratory talks on Friday. For BASF, a takeover of Evonik would be one of the largest acquisitions in the company's 160-year history. The Ludwigshafen-based company's largest acquisitions to date were the acquisition of Bayer's seed and herbicide businesses in 2018 for 7.6 billion euros and the purchase of the US catalyst manufacturer Engelhard in 2006 for 4.8 billion dollars.

The RAG Foundation will play a key role in a possible merger between Evonik and BASF. It holds 43 percent of Evonik. The state of North Rhine-Westphalia is represented on the foundation's board of trustees by Prime Minister Hendrik Wüst.

The Düsseldorf Ministry of Economic Affairs is following the takeover interest very closely, said Economics Minister Mona Neubaur. “Every solution must be measured by whether it would give a future to the investments at the locations in North Rhine-Westphalia and the people who work there,” she said. The foundation itself did not want to comment on the offer.

The chairman of the IG BCE union, Michael Vassiliadis, who sits on both the board of trustees of the RAG-Stiftung and the supervisory board of BASF, sees many unanswered questions regarding a possible takeover. A purchase of a successful company by another will not become a story of the future for locations and employees simply because the new entity will become larger, he said. There must be future prospects and investment commitments for the employees of both companies.

Evonik itself declined to comment on the current situation. BASF did not want to comment on the price mentioned, but said that a possible takeover would strengthen and complement its own core businesses. The company is pursuing a disciplined approach: "Our assessment is based on a synergy potential that can only be verified with the involvement of Evonik." Evonik shares rose by up to 2.5 percent to 19.85 euros on Monday.