BASF/Cognis deal to go through as early as next week
10 June 2010 16:08 [Source: ICIS news]
LONDON (ICIS news)--BASF is close to completing a deal to acquire additives producer Cognis, with the possibility that the sale could be announced as early as next week, sources familiar with the planned transaction said on Thursday.
News reports on Wednesday said the German chemicals major BASF had in principle agreed the acquisition, and were nearing the end of discussions with Goldman Sachs and Permira, which advise a group of private equity firms that own Cognis.
BASF would be expected to pay close to €3bn ($3.6bn) including debt for Cognis, based on ICIS calculations.
On May 26, when Cognis released its first quarter earnings for 2010, its CFO Marco Panichi indicated a fair value for the company would be in the range of 6 to 10 times earnings before interest, taxes, depreciation and amortisation (EBITDA), including net debt.
Panichi said he would be relatively comfortable with a valuation placed in that range. On a price-earnings multiple of eight, Cognis would be worth about €2.9bn based on the adjusted EBITDA of €364m the company reported for the full year of 2009.
BASF, Cognis, Goldman Sachs and Permira all said they would not comment on rumours or speculation.
In May, following news reports that BASF had made a bid for the group, Cognis had not ruled out the possibility of a takeover as it looked at strategic options for the future.
If the acquisition of Cognis went through, it would be BASF’s largest deal since it bought specialty chemicals major Ciba for around €3.9bn in April last year.
($1 = €0.83)
To discuss issues facing the chemical industry visit ICIS connect
By: Franco Capaldo
+44 (0)20 8652 3214
For the latest chemical news, data and analysis that directly impacts your business sign up for a free trial to ICIS news - the breaking online news service for the global chemical industry.
Get the facts and analysis behind the headlines from our market leading weekly magazine: sign up to a free trial to ICIS Chemical Business.
| ICIS news FREE TRIAL |
| Get access to breaking chemical news as it happens. |
| ICIS Global Petrochemical Index (IPEX) |
| ICIS Global Petrochemical Index (IPEX). Download the free tabular data and a chart of the historical index |
Related Articles
- 11 Nov 10 15:33 European Commission delays deadline for BASF's Cognis takeover
- 23 Jun 10 19:12 Fitch affirms BASF on €3.1bn takeover deal for Cognis
- 23 Jun 10 13:28 Moody's puts BASF long-term A-1 credit rating on review
- 23 Jun 10 13:02 BASF expects 14% market share in personal care chems with Cognis
- 23 Jun 10 09:44 BASF agrees to buy Cognis for €3.1bn
- 21 Jun 10 11:10 BASF to acquire Cognis after Lubrizol bid said to be rejected
- 14 Jun 10 09:00 Europe top stories - weekly summary
- 15 Jun 10 23:07 BASF addresses EPS bag problems in North America
- 11 Jun 10 10:11 BASF raises polyisobutene capacity with new Ludwigshafen plant
- 26 May 10 12:10 Cognis will not rule out potential takeover after BASF bid talk
- 07 May 10 16:48 BASF board said to have approved bid for Cognis
- 26 Apr 10 11:49 Cognis swings to first quarter net profit of €47m
- 09 Apr 10 20:19 BASF preparing €3bn offer for Cognis – reports
- 01 Apr 10 16:11 Cognis to sell UV acrylates business to IGM Resins
- 24 Mar 10 12:12 Cognis swings to Q4 2009 net profit of €24m as demand recovers
Latest News
- 18 Jun 13 21:44 US Midwest gasoline prices continue to fall from near-high records
- 18 Jun 13 21:36 US energy independence requires ‘psychological’ shift: Senator
- 18 Jun 13 20:34 Formosa increases capacity for new Texas cracker, PDH unit
- 18 Jun 13 19:33 Firm sees global demand for plastics in cups, lids rising 5.9%/yr
- 18 Jun 13 19:00 VIDEO - ICIS Americas Lunchtime Bulletin 18 June 2013