BASF makes merger offer to rival Evonik, FT says

• BASF has reportedly been speaking to banks about a potential Evonik takeover since earlier in the year
• Evonik's spokesperson declined to comment, while a source said the company was not aware of any takeover approach
• The approach includes discussions with RAG Foundation, Evonik's largest shareholder

Summary: BASF Makes Merger Offer to Rival Evonik

German chemical giant BASF has approached rival Evonik Industries regarding a potential merger, according to a Financial Times report on September 25. The proposed deal would involve discussions with Evonik's largest shareholder, RAG-Stiftung.

Key Developments:

Sources told the FT that BASF has been consulting with banks about a possible takeover since earlier this year, indicating extended deliberations on the transaction. However, a source familiar with the matter informed Reuters that Evonik is currently not aware of any takeover approach from BASF, creating uncertainty about the status of negotiations.

Company Responses:

Both companies have remained largely silent on the matter. An Evonik spokesperson declined to comment on the FT report, while BASF could not be immediately reached for comment, leaving the market without official confirmation or denial.

Market Implications:

If successful, a BASF-Evonik merger would create a German chemicals powerhouse, consolidating two major players in the industry during a challenging period for European chemical manufacturers. The sector has faced headwinds from high energy costs, weak demand, and intense competition from Asian producers.

The involvement of RAG-Stiftung, Evonik's largest shareholder, will be crucial to any deal's success. The foundation's approval would likely be necessary for the transaction to proceed.

Context:

This potential consolidation reflects broader pressures in the European chemicals industry, where companies are seeking scale and efficiency to remain competitive globally. The outcome of these discussions could significantly reshape the German and European chemical manufacturing landscape.