Private Equity Firm Lone Star Buys BASF Chemical Business

December 23, 2019 | Investments, News, Private Equity, Takeovers and Buyouts

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It wasn’t cheap – the deal was worth $3.51 billion

Lone Star, the Dallas-based PE shop, has purchased the Construction Chemicals business of BASF. The $3.51 billion deal will likely close in Q3 2020.

BASF will now attempt to focus on more profitable operations after this deal, according to a press release. Reuters had also reported that a deal was pending last month after Lone Star aligned itself with several firms seeking a deal. The PE shop had previously walked away from a bid but returned after a new invitation.

“Our aim was to find a new home for our Construction Chemicals business where it can leverage its full potential,” said Saori Dubourg, member of the Board of Executive Directors of BASF SE. “Under the umbrella of [the PE firm], the Construction Chemicals team can focus on a growth path with an industry-specific approach.”

Lone Star and BASF Deal

Meanwhile, the BASF Construction Chemicals business has 7,000 employees. It operates in more than 60 countries. In 2018, the firm has also generated sales of about €2.5 billion.

“BASF’s Construction Chemicals business fits very well with our portfolio, complementing our investments in the construction materials industry,” said Donald Quintin, LS President of Europe. “We highly value the industry-wide recognized knowledge and competence of BASF’s Construction Chemicals experts, backed by a strong track record in innovative products and a compelling R&D pipeline. We look forward to jointly pursuing a growth-oriented business approach.”