BASF could raise its acquisition offer for Evonik after the German company rejected an initial proposal valued at 10.3 billion euros, equivalent to 22.15 euros per share. According to Personal Care Magazine, which cites Reuters reports, sources close to BASF believe that the initial offer is unlikely to be the last.
Last September, BASF confirmed that it had held exploratory talks with Evonik and with RAG-Stiftung, the latter's main shareholder, to study a possible acquisition. Evonik acknowledged having received a non-binding proposal to launch a voluntary public takeover bid for all of its shares. However, the company stated that there were no ongoing negotiations.
The operation is part of BASF's strategy to strengthen its core businesses and gain competitiveness in an increasingly demanding global chemical market. The company seeks to respond to pressure from international competitors, especially Chinese ones, such as Sinopec. An integration would allow for the generation of operational synergies, expansion of its product portfolio, and reduction of its dependence on the European market.
Implications for the cosmetic industry
The possible acquisition would also have consequences for the beauty sector. BASF and Evonik are two relevant suppliers of ingredients for cosmetics and personal care, with a presence in areas such as skin care actives, emollients, and surfactants. An integration could expand the technological and commercial capabilities of the resulting group, but also modify the competitive balance of the ingredient market. The concentration of two large suppliers under the same structure could affect the sourcing alternatives for cosmetic manufacturers and brands, in addition to subjecting the operation to the scrutiny of competition authorities.
For the moment, no new offer or resumption of negotiations has been announced. The evolution of this possible agreement will be relevant to follow the consolidation of the European chemical sector and its effects on the supply chain of cosmetic ingredients.