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BASF to launch construction chemicals unit sale in spring: sources

Reuters  |  FRANKFURT 

By Schuetze and Patricia Weiss

(Reuters) - will launch the sale of its $3 billion-plus business in the spring, as part of the German group's drive to focus on more profitable operations, people close to the matter said.

BASF, which flagged its intention to auction off or merge the unit in October, said on Tuesday it had hired to organise the transaction.

"We are still at an early stage of the process," a said, declining to comment further on the timing.

declined to comment.

The world's largest maker of for concrete is expected to fetch roughly 3 billion euros ($3.4 billion), the sources said.

First information packages are expected to be sent out to prospective bidders in March, the sources said, while one of them added that first-round offers were likely to be due before the summer break.

The company's new in October unveiled plans to hive off the unit as looks for ways to boost the group's share price.

The company said at the time that the business, whose products have been used to build major train tunnels in the Swiss and in London, was not deeply integrated into production network and that it had fallen short of profitability targets.

It has grown little since BASF purchased it from in 2006 for 2.7 billion euros including debt. The unit's need to cater to a large number of small to mid-size builders goes against focus on large industrial customers, industry analysts said.

BASF bought seeds and from and is seeking to wrap up the purchase of an engineering business from to bolster margins at a time when its basic petrochemical businesses are slowing down.

Switzerland's Sika, which is buying French company from CVC Capital Partners, said last month it would be interested in the BASF unit but doubted a deal for all of the business was possible because of antitrust restrictions.

Companies such as LafargeHolcim, Saint Gobain, GCP, and are also seen as potential suitors for all or parts of the business, as well as buyout groups such as Advent, or CVC.

($1 = 0.8874 euros)

(Additional reporting and writing by Ludwig Burger; Editing by Mark Potter)

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Tue, February 12 2019. 17:11 IST