Chemicals

BASF’s caution beats Bayer’s chutzpah

12 Oct 2016

German chemical giant BASF stayed on the fence when rival Bayer splashed out $66 bln for Monsanto. Since May, BASF's value relative to the DAX index has risen, while Bayer has lost twice as much. Better-than-expected quarterly results make BASF look doubly smart.

One equal merger evaporates as another takes root

12 Sep 2016

Gas producers Linde and Praxair gave up on a $60 bln-plus combination on the same day fertilizer producers Agrium and Potash Corp inked their nearly-$30 bln union. Both deals had strategic logic on their side. But geography, bosses' egos and other factors can win out.

ChemChina’s Syngenta joy has a downside

22 Aug 2016

U.S. regulators okayed the Chinese chemical group’s $43 bln bid for its Swiss peer, and only limited spin-offs may be required. With no synergies, ChemChina needs the skills it acquires to be compelling. The fact it was waved through raises the risk they may not be.

Bayer’s modest bump puts target Monsanto on spot

14 Jul 2016

The German chemical giant raised its offer for the American seed purveyor to $64 bln, including debt. It's a token $2 bln increase from Bayer's initial bid. That should scotch hopes that Bayer will go a lot higher. For Monsanto boss Hugh Grant, decision time is fast approaching.

Monsanto’s bid defense withers on the vine

29 Jun 2016

The U.S. seedmaker’s disappointing third-quarter performance makes it hard to see how Monsanto can lure chemical group Bayer into sweetening an already frothy $62 bln offer. The suitor may be willing to look past a cyclical dip, but its negotiating position now looks stronger.

Korean suitor could end U.S. chemical bid warfare

7 Jun 2016

Lotte has approached vinyl producer Axiall, which is fending off a hostile $3 bln advance from rival Westlake. Although the Asian interloper didn’t disclose specifics, Westlake is already offering an eye-popping 140 pct premium. The winning sweetener could involve more cash.

Chemours short-selling critic gets it half right

6 Jun 2016

Citron Research says a toxic mix of environmental liabilities and debt could push the $1.5 bln DuPont chemicals spinoff into bankruptcy. Though an overstatement of the bear case, it raises worthwhile questions about the Chemours balance sheet - and DuPont management’s intent.

Deutsche Bank needs BASF to spare its M&A blushes

23 May 2016

Germany’s biggest bank has no role on potentially the country’s largest deal - the $62 bln offer by Bayer for agrochemicals peer Monsanto. Deutsche’s share of global and domestic dealmaking is down. It sorely needs BASF, its own advisory gig, to hatch a successful counterbid.

Monsanto may strain to make case against Bayer bid

23 May 2016

A $62 bln all-cash offer from the German titan exploits a cyclical downturn in global agrochemicals. Even if Monsanto’s profit picks up again as expected, however, investors would have to value it considerably higher to match the takeover price. The bird in hand will be tempting.

Bayer’s Monsanto bid flags conglomerate curse

23 May 2016

Agro giants will have to wait for Malthus boost

23 May 2016

Tougher U.S. laws on tax inversions are one reason why Dutch fertiliser group OCI’s merger with CF Industries is off. But with supply outstripping demand, fertiliser prices are also falling. That’s delaying the price hikes that should come from rising populations.

BASF best leaving Monsanto seeds for the birds

19 May 2016

Bayer’s bid for the U.S. seed maker puts its German rival on the spot. Monsanto and BASF work together on research and there are few other potential merger partners. Yet the maths of a $50 bln-plus counterbid would be a stretch. BASF has sat out other big deals; it can again.

Bayer would risk choking on Monsanto

12 May 2016

The $94 bln German chemical giant may be mulling a bid for the U.S. seed maker. Monsanto, worth $39 bln, would need convincing. A deal pitched at a 30 pct premium is financially feasible, but Bayer would need to raise a lot of cash – and deal with clashing cultures.

Air Products and Evonik neutralize deal imbalance

6 May 2016

The U.S. industrial-gas producer is selling specialty chemicals to its German peer for $3.8 bln. A lofty valuation of 16 times last year’s EBITDA helps Air Products cover a tax hit triggered by the sale. To justify the price, Evonik is rustling up meaningful savings of its own.

Dow-DuPont deal would be tough nut for interlopers

7 Mar 2016

German chemical giant BASF may be considering a counterbid for U.S. rival DuPont. The price would have to include a whopping premium – and cover a $1.9 bln break fee. The tax benefits alone could make the agreed-upon $130 bln union and spinoff with Dow Chemical close to ironclad.

Scalia’s empty seat reverberates beyond Washington

26 Feb 2016

Dow Chemical is paying $835 mln in a decade-old lawsuit that was heading to the Supreme Court. The company decided the conservative judge’s death changed the balance of the outcome and settled. It’s a reminder that politics surrounding the top U.S. bench has real-world effects.

Syngenta up against element of regulatory surprise

3 Feb 2016

The Swiss seed maker says its $43 bln sale to ChemChina shouldn’t raise U.S. national security fears, despite hot-button facets like chemicals, food and China. Yet Philips’ blocked lighting-unit deal shows Uncle Sam can veto without explanation. That’s reason enough to be wary.

Syngenta deal has two big winners, 1.4 bln losers

3 Feb 2016

ChemChina’s $43 bln cash takeover of the Swiss seed maker won’t involve job cuts, management sackings or cheeky tax reduction. Great for Syngenta shareholders and employees; not so for the buyer. Fortunately, the cost is spread widely – among China’s unwitting savers.

ChemChina megadeal will need FrankenFinancing

3 Feb 2016

A near-$44 bln takeover of Swiss agribusiness Syngenta would be one of the biggest deals ever struck by an unlisted buyer. That calls for a monstrous funding package. The target could probably shoulder $16 bln or so of new debt. Big Chinese banks will also need to step up.

ChemChina’s Syngenta bid is prickly for Monsanto

2 Feb 2016

The state-owned group is nearing a $42 bln deal for the Swiss seeds and pesticides group. The cash and friendly nature make it better than a similarly valued offer from Monsanto. The U.S. company could improve its bid or turn its attention to BASF. Neither M&A option looks easy.