BASF stike a very good deal with EU in meeting competition concerns over Ciba acquisition.
BASF has reached agreement with the EU Union anti-trust approval board and found a way forward to complete its acquisition of Ciba Specialty Chemicals.
Last September, BASF agreed to buy Ciba for CHF6.1 billion, but the EU regulators had concerns over the distortion of competition in products used in paper, plastics and skin care. BASF has agreed to sell off some of these businesses in order to win regulatory approval.
The details will become more clear, but the staement was that BASF, '.... will sell chemical plants in Ludwigshafen and Ciba units making synthetic dry strength agents for the European paper industry; the pigment, bismuth vanadate, sold globally; and a Finnish-based business making glue for the paper industry.' The statements were made to confuse and not give a transparent view of what was being sold and to whom. It will all come out within the next few days - it just takes a couple of phone calls to Ciba!
Furthermore, the 'statement' goes on to say that, ' ..... Ciba's know-how for making and selling the pigment indathrone blue will be transferred, and aunit making light-stabilisers for plastics will be divested.' It will also strike a licensing deal to allow rivals to use an ultraviolet filter Ciba developed for skin care.
On the face of it, BASF has made a good deal with the EU and will now find themselves in a very dominant position in the paper chemicals industry.
CIBN (Zurich) rose 30 centimes to CHF48.30 and BASF (Frankfurt) rose 84 euro cents to EUR24.26.
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