BASF makes offer to acquire Ciba Holding AG

15 Sep '08

6 min read

“Against the backdrop of increasingly challenging conditions within our industry, this is a transaction which combines a fair price with an industrially compelling solution for Ciba,” said Dr. Armin Meyer, Chairman of the Board of Directors of Ciba.

“Ciba's businesses will be strengthened substantially thanks to integration into BASF's Verbund and the access to BASF's research, production and marketing platform. This applies particularly in the Plastics, Coatings and Paper divisions. BASF is a long-standing customer and supplier of Ciba and well-acquainted with our people and our business. The acquisition of Ciba by BASF will provide a long-term perspective for profitable growth of the Basel operations in particular and our other businesses around the world.”

Clear advantages in global competition:
“In the current consolidation phase in the chemical industry, the acquisition of Ciba offers clear advantages in terms of global competition,” said Hambrecht.

The merger of the activities of BASF and Ciba would extend BASF's leading position as a preferred supplier to the plastics industry and make BASF the second-largest supplier of coating effect materials. In the fast-growing and highly profitable market for plastics additives, BASF would expand its portfolio by gaining important product segments such as UV stabilizers and antioxidants. In the area of coating effect materials, the combination of BASF and Ciba would offer an extensive range of pigments, resins and additives.

Thanks to economies of scale and greater efficiency, the resulting leading supplier of chemicals for the paper industry would offer the broadest product portfolio in the industry and with its global reach would provide customers with the best range of products and services in a difficult market environment. Extensive restructuring is necessary throughout the entire paper value chain. By combining and repositioning the paper chemicals businesses of BASF and Ciba, BASF would start this urgently needed process with the aim of ensuring the long-term profitability of these activities.

Stronger growth in the markets of the future:
In addition, the planned acquisition would strengthen BASF's presence in fast-growing emerging countries and improve its market position in important industries such as automotive, packaging, construction, electronics and water purification. Thanks to the integration in BASF's Verbund, Ciba's businesses for attractive niche markets such as oil and mining would benefit from wider market access and BASF's extensive application and product know-how.

This would open up additional growth opportunities. The two companies also complement each other very well with regard to research and development. Combining the specific application know-how of Ciba with BASF's strong R&D platform would make it possible to provide customers worldwide even faster with better products and solutions.

Offer period expected to begin on October 1, 2008:
BASF will (September 15, 2008) publish the formal advance notification in which the offer is officially announced and which contains all the fundamental information on the planned offer. The offer prospectus is scheduled to be published on October 1, 2008.

The offer is expected to begin with the publication of the offer prospectus following the approval of the offer by the Swiss Takeover Board and, subject to later extension, will be valid for 20 trading days plus an obligatory extension of 10 trading days in accordance with Swiss law. The offer is subject to a number of conditions.

These include the tendering of at least 66.67 percent of all nominal shares, approval by the relevant authorities, as well as the removal of various takeover defenses in Ciba's statutes. BASF expects to finalize the transaction in the first quarter of 2009 at the latest. The financing for the offer is in place.

BASF

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