“We now want to take the next step. Alongside Evonik. » BASF CEO Markus Kamieth reaffirms his group's desire to begin negotiations around the merger project

BASF’s chief executive, Markus Kamieth, last week reiterated the company's intent to move beyond preliminary consultations and enter formal negotiations on a possible merger with German specialty chemicals giant Evonik. The decision follows months of behind‑the‑scenes discussions between the two firms, aimed at exploring how their complementary product portfolios could be leveraged to create a more resilient, scale‑oriented entity in an increasingly volatile chemical market.

The impetus for the talks stems from a broader trend of consolidation in the European chemicals sector, prompted by rising input costs, supply‑chain disruptions and a growing push for sustainability across the industry. By combining their strengths, BASF and Evonik hope to secure better bargaining power with suppliers, streamline operations, and accelerate the development of green chemistry solutions—areas that both companies have highlighted as strategic priorities in recent years.

In practice, the merger could integrate BASF’s bulk chemical businesses with Evonik’s high‑value specialty products, offering a full spectrum from commodity feeds to niche functional additives. Such a breadth could allow the new entity to better spread risk across growth segments, while shared research and development platforms might reduce duplication and accelerate time‑to‑market for innovative solutions.

Regulatory approval will be a critical hurdle. The European Commission, which has historically scrutinised large M&A deals in the chemicals sector, will assess potential anti‑competitive effects, particularly in high‑dialect segments such as dyes, plastics additives and industrial gases. Both companies have signalled a willingness to cooperate with regulators and to provide detailed disclosure on how synergies would be structured.

From an investor’s perspective, the merger offers a clear narrative of scale as a buffer against cyclical downturns, but also introduces transitional costs and integration risks that could weigh on short‑term profitability. Market watchers will likely focus on how the deal’s financial structure—whether through cash, equity or a combination of both—might impact both companies’ balance sheets and shareholder value.

Going forward, the next step is to formally engage in negotiations. While an exact timeline has not yet been disclosed, stakeholders can expect a phased approach that begins with viability studies, followed by detailed due‑diligence, and culminating in regulatory filings. The outcome of these proceedings will shape not only the future of two of Germany’s largest chemical producers but also the competitive dynamics of the global specialty chemicals market.

Machine-translated from French