BASF's Evonik Pursuit Runs Into Political Headwinds in North Rhine-Westphalia
Published on 10/07/2026 at 14:21 | Editorial boerse-global.de
BASF CEO Markus Kamieth used the Deutschland-Gipfel in Berlin to make the strategic case for consolidation in specialty chemicals, arguing that a combination with a strong player in the field would make "a great deal of sense." The Ludwigshafen-based group, he suggested, would bring its existing strength in basic chemicals to such a tie-up — a rationale that points squarely at Essen-based Evonik.
The overture has already taken concrete form. BASF submitted a non-binding offer worth roughly EUR 10 billion in recent weeks, which Evonik's management board rejected as insufficient. According to Evonik, no talks are currently underway, while BASF continues to describe the outcome of the exploratory discussions as open. Media reports put the first bid at around EUR 22.15 per Evonik share, valuing the target at approximately EUR 10.3 billion. BASF has countered that its valuation rests on synergy potential that can only be verified once the target is directly integrated.
A Landmark Vote Looms in Düsseldorf
While Ludwigshafen makes its pitch, political resistance is hardening in North Rhine-Westphalia. The opposition SPD today called on Minister-President Hendrik Wüst to examine a state stake in Evonik. Under the Social Democrats' proposal, the state and the RAG-Stiftung would together secure a controlling majority of more than 50 percent. The party's parliamentary group, led by Jochen Ott, estimates the cost of such a stake at around EUR 800 million, potentially financed through the state-owned NRW-Bank.
The aim is to preserve Evonik's independence, its Essen headquarters and key decision-making functions in North Rhine-Westphalia. The SPD is also demanding binding protections for sites including Marl and Wesseling, ruling out compulsory redundancies and the relocation of major business units for a defined period. The Düsseldorf state chancellery likewise stressed the importance of maintaining the company's independence but has yet to name concrete steps. The NRW state parliament will debate the motion next week.
The RAG-Stiftung Holds the Decisive Lever
How the situation unfolds depends heavily on Evonik's largest shareholder. The RAG-Stiftung currently holds roughly 43 percent of the shares, and Minister-President Wüst sits on the foundation's board of trustees by virtue of his office. Foundation chief Bernd Tönjes has expressed skepticism about expanding the stake, favoring instead a gradual reduction of the foundation's holding to 25.1 percent. Without the foundation's approval, a merger is hard to imagine.
Should investors sell immediately? Or is it worth buying BASF?
For BASF, the interest in Evonik reflects mounting pressure across the industry. The group is looking for ways to shore up its traditional basic chemicals business with higher-margin specialties, and large acquisitions are seen in the current environment as a lever to realize scale advantages and withstand international competition.
Price Discipline Is the Deciding Variable
The central question for the coming weeks is how Evonik is valued — and whether BASF maintains price discipline. A takeover in the chemicals sector carries substantial integration risk: if the premium runs too high, the eventual synergy capture may no longer justify the purchase price. Because the outcome of the talks remains entirely open, as BASF itself emphasizes, any news of shifting price expectations or structured counteroffers is likely to trigger immediate moves in the share price. Negotiations with the RAG-Stiftung, as a major co-owner of Evonik, set clear boundaries for the room to maneuver.
In the optimistic scenario, BASF integrates Evonik in whole or in significant part on conditionally acceptable terms. A combination would markedly strengthen its market position in high-margin specialty chemicals and unlock considerable scale effects, with the synergies BASF has cited potentially proving a lasting earnings driver. That narrative is flanked by the ongoing development of the group's own specialties portfolio: BASF recently reported the use of Ultramid B3K in reusable transport boxes for logistics, an expansion of the Ultradur portfolio with post-consumer recyclates for automotive applications, and a broader application range for its Ultrason line in components for artificial intelligence and e-mobility. Should the acquisition succeed at a disciplined price while these technology areas gain strength, the foundation for a re-rating would be in place.
The Risk of an Expensive Bidding War
On the other side sits the real danger that management becomes entangled in a protracted and costly bidding contest. If BASF were forced to raise its offer of EUR 22.15 per Evonik share substantially to break the resistance of the target's management and the foundation, the returns on the endeavor could be diluted. A collapse of the talks would also risk a phase of disillusionment, with market participants potentially reading a retreat as strategic cluelessness in the European consolidation process. The group would be spared the deployment of massive resources, but the near-term catalyst for a leap in portfolio growth would be missing. The general cyclicality of the global chemicals economy adds further hazards that a major acquisition could amplify — particularly if a deal were accompanied by heavy borrowing, raising BASF's vulnerability to unexpected demand weakness in its classic base businesses.
What Investors Are Watching Now
For shareholders, the situation boils down to a clear constellation: as long as the stock holds above its key support levels and management sticks to strict financial discipline, the path toward its 52-week high of EUR 55.05 remains intact. If sentiment sours through an overpriced revised offer or an abrupt end to negotiations, selling pressure is likely to weigh on the price. The shares closed yesterday at EUR 50.73 and were up 1.2 percent at EUR 51.36 in today's trading, extending a gain of 16 percent since the start of the year.
Beyond the quarterly figures themselves, analysts and market observers are expected to focus above all on management's accompanying comments on the state of the takeover talks and on the annual guidance. Until then, the dialogue with Evonik remains the dominant driver of the share price — and whether Kamieth can deepen the exploratory talks now hinges largely on whether BASF can allay the concerns of the foundation and the politicians.
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