BASF Start to Prepare Organisation for Swallowing Ciba

BASF has announced that it will optimise its structure and lay the foundation for the rapid integration of Ciba's businesses.  Sounds ominous!

The main changes will be in the 'Performance Products segment', and will take effect on the 1st April, 2009, assuming the anti-trust authorities approve the merger.  From the end of the first quarter, the 'Discovery Phase', will involve a two month analysis of the joint businesses with the integration expected to start in the second half of 2009.  Despite the co-operative tone of the announcement, BASF is not known for consultation and conciliation and it is more than likley that the bulk of the BASF plan will already have been decided and there will be a quick implementation and integration of Ciba.

BASF's performance products 'segment' consists of:

• Acrylics and Dispersions
• Care Chemicals
• Performance Chemicals
• Paper Chemicals (a new devision from 1st April) - this division will initially consist of BASF's business with paper chemicals, binders and kaolin minerals.  After the so-called 'Discovery Phase', Ciba's paper chemicals activities will be integrated into this division.  Dr Ehrenfried (Fred) Baumgartner (56) will move from being head of BASF's Inorganics Divison to head up Paper Chemicals.  BASF will then become the largest supplier of chemicals to the world-wide paper industry.  The paper industry waits with interest to understand what The Chemical Company's definition is of a 'market-oriented positioning' for the combined businesses'!  

In the same announcement, BASF has indicated its intention to 'review its strategic options for leather and textile chemicals' - this is probably management code for exiting these businesses.