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Dec. 8, 2023 By Ludwig Burger and Patricia Weiss, Reuters FRANKFURT - BASF (BASFn.DE) plans to turn its agriculture, battery materials and coatings businesses into autonomous units to try to boost earnings, a major revamp for the German chemicals giant that has traditionally been highly integrated. The company, with sales of 87 billion euros ($94 billion) last year, will create legally separate entities for the three units, trade union IGBCE said in a statement on Thursday, which was confirmed by a company spokesperson. However, "there is no intention to sell these businesses," CEO Martin Brudermueller said during an investor conference. He earlier said external investment partners could be taken on board to share the cost of expanding the battery business. BASF has already made its catalytic converter business, which relies on combustion-engine powered cars, a standalone subsidiary, which it said in October there were no current plans to sell. BASF's shares rose as much as 2% before paring gains to close 1.4% higher at 45 euros each. Other industrial groups in Germany, including ThyssenKrupp (TKAG.DE), have pursued separation moves, which are typically welcomed by investors who often prefer to buy shares in pure-play companies. Bayer (BAYGn.DE), a rival maker of seeds and crop chemicals, last month said it was considering breaking up its business to improve a battered share price, while chemicals distributor Brenntag (BNRGn.DE) will reorganise into two independent divisions as it faces pressure from activist investors. "When something is separated, people draw their own conclusions and expect a sale," the head of BASF's works council, Sinischa Horvat, told Reuters, although he said management had assured him this was not the case. The revamp comes as Brudermueller gets ready to retire from BASF in April 2024 to become non-executive chairman of Mercedes Benz (MBGn.DE). Markus Kamieth, in charge of BASF's Asian operations and chief technology officer Melanie Maas-Brunner are vying to succeed him, a person familiar with the matter has told Reuters. To read the entire report click here. Tweet |
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