BASF Clears EU Hurdle for Coatings Sale as Agribusiness IPO Nears Milestone
03.06.2026 - 18:32:46 | boerse-global.de
European Union regulators have given the green light to BASF’s planned €7.7 billion sale of its coatings business to private equity firm Carlyle, removing a major regulatory roadblock in the chemical giant’s sweeping portfolio overhaul. The approval, granted with conditions, requires BASF to divest certain polysulfide operations to rival Nouryon to address antitrust concerns. The company expects the transaction to close before year-end, with proceeds earmarked for ongoing capital return programmes, including its share buyback.
The coatings unit is meanwhile undergoing a leadership transition. Steve Arndt will take over as Senior Vice President for Global Automotive Refinish Coatings on 1 July, succeeding Chris Titmarsh, who departs after two decades at the group. Arndt brings more than 30 years of industry experience, most recently from Axalta Coating Systems, as the division navigates a deep restructuring ahead of the ownership change.
On a separate track, BASF’s planned initial public offering of its agricultural solutions arm is gathering pace. The company expects the spin-off entity — BASF Agricultural Solutions Deutschland GmbH — to be registered in the commercial register as early as July, a concrete milestone toward a listing planned for mid-2027. Shareholders approved the hive-down at the annual general meeting in late April, and the notarial deed was signed in March. Around 2,500 employees at Ludwigshafen and Limburgerhof will transfer to the new legally independent subsidiary, retroactive to 1 January 2026. The unit will be structured as a European stock corporation and list on the Frankfurt exchange, with BASF retaining a majority stake.
The operational separation of the agri business is running alongside the rollout of a new ERP system. North America has already completed the transition, with all other regions targeted for completion by early 2027. First-quarter results for the division were hit by currency headwinds and the fallout from the Middle East conflict, though volumes remained resilient. Management says the unit is “on track”.
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Cost-cutting, meanwhile, is exceeding original targets. By the end of 2025, BASF had achieved an annual run-rate cost reduction of roughly €1.7 billion — €100 million ahead of plan. The company now expects to reach €2.3 billion in annual savings by the end of 2026, up from the earlier target of €2.1 billion. For the full year 2026, management continues to forecast EBITDA before special items of between €6.2 billion and €7.0 billion, with free cash flow in a range of €1.5 billion to €2.3 billion.
The €1.5 billion share buyback programme launched in November 2025 is set to run until the end of June 2026. BASF has so far repurchased and cancelled roughly 27.8 million shares, providing a tailwind to earnings per share. The next major event for investors is the half-year report, due on 29 July (or 30 July, according to some sources), when the market will gauge whether operational momentum matches expectations.
The broader German chemical sector continues to struggle. The VCI industry association reported that chemical and pharmaceutical output fell 6% year-on-year in the first quarter, with sales down 5.4%. Capacity utilisation edged up to 75.1% but remained below profitable levels. VCI managing director Wolfgang Große Entrup attributed modest growth in some segments to “geopolitical hoarding” and noted “no sign of an upturn”.
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Analyst opinions on BASF remain split. Deutsche Bank’s Virginie Boucher-Ferte rates the stock a Buy with a €60 target, while Goldman Sachs’ Georgina Fraser is also bullish, lifting her price target to €65. JP Morgan’s Chetan Udeshi takes a more cautious stance, with an Underweight rating and a target raised to €40. The shares currently trade at €50.56–€50.71, roughly 8% below their 52-week high of €55.05. The stock has gained about 20% over the past twelve months but remains below its 50-day moving average of €52.31, with a relative strength index of 42.8 indicating neutral territory.
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