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Deals Coming Back - June 28,2010 CW Insider
June 28, 2010 | By ROB WESTERVELT
Recovery has the chemical sector quickly shedding inhibitions about M&A. BASF has sealed a deal to acquire Cognis for €3.1 billion ($3.8 billion). And Akzo Nobel reached an agreement to sell its National Starch (Bridgewater, NJ) unit to Corn Products International (Westchester, IL) for $1.3 billion in cash. Constraints on private equity have eased as well, as demonstrated by Bain Capital’s acquisition of Styron from Dow Chemical, which closed earlier this month.
M&A activity has resumed but companies are being deliberate. BASF’s strategy is to “strengthen our strengths and eliminate our weaknesses,” says BASF chairman Jürgen Hambrecht. “We want to make our portfolio more competitive and cyclically resilient.” This effectively lays out the roadmap for specialty and diversified chemical makers who will continue to move away from commodity businesses where they do not have clear advantages.
Articles of interest from our latest issue can be found at chemweek.com using the links below.