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NEWS & INFORMATION

Green light from the EU Commission

American Cyanamid acquisition by BASF closed within three months

  • New position in the top three global players
  • R&D pipeline with 15 actives
  • Savings: U.S. $250 million per year

July 1, 2000, will be the closing for BASF AG of Ludwigshafen, Germany, taking over the Cyanamid agricultural products business of American Home Products Corporation (AHP), a company head-quartered in Madison, New Jersey. This purchase, the largest acquisition in the corporation's history, doubles BASF's crop protection products business and moves it up into the ranks of the world's top three leading manufacturers of crop protection products. BASF's crop protection sales amounted to US $1.9 billion in 1999. This closure follows approval of the EU Commission. Earlier in June, the waiting period under the Hart-Scott-Rodino pre-merger notification statute expired without any action by the US antitrust agencies.

"With this step, we have consistently expanded our traditional strengths in crop protection, both regionally and from a portfolio viewpoint," says Eggert Voscherau, member of the Board of Executive Directors and responsible for the Health & Nutrition segment, which includes BASF's Crop Protection business.

Since signing the agreement at the end of March, BASF has moved ahead quickly in planning of the integration, to be ready for the important fall launches in the Northern Hemisphere. "I am very proud that we have managed to implement our ambitious plan within such a short time span, and this fills me with confidence as we tackle the upcoming integration process," states Friedrich Vogel, president of the Crop Protection Division.

In the past few weeks, BASF has defined more than 100 key positions within the new crop-protection business. This puts into place a solid foundation for the further expansion of the global business. Once the purchase has been completed in most countries of the world, BASF will be in a position to work out the details of the strengthened crop protection business. In some countries, the merger will take place in a matter of weeks, in accordance with the local regulatory requirements.

"Our teams will continue to work as thoroughly and quickly as they have been doing so far," says Friedrich Vogel, "so that the new, expanded and very powerful organization will already be up and running in October. Our new team will then, with the same commitment, be able to offer our customers an even more attractive product portfolio."

The future global headquarters of the Crop Protection Division will be Mount Olive, New Jersey. Friedrich Vogel goes on to say, "That way, we will be in a better position to place more emphasis on the strategically important agricultural regions of North and South America."

By integrating the global Cyanamid agricultural products business, BASF is building a crop protection business that will be successful, based on the following decisive factors:

  • BASF is taking a leading position in important agricultural markets. Its global presence will be considerably expanded, especially in the significant agricultural markets of North and South America. The well-established position in Europe will be further strengthened.

  • BASF offers a broad and innovative product portfolio for all major crops and
    will now also have access to a proven line of insecticides.

  • BASF also will have a leading position in herbicides for forest management, native plant species restoration and rights-of-way, in addition to insecticides for urban pest control and public health programs. The company also adds to its portfolio of turf and ornamental products in the US, Japan and other countries.

  • BASF will develop the combined research pipeline of 15 active ingredients, to be introduced between now and 2006 with a peak sales potential of US $2 billion.

On the basis of the figures for 1999, this joint undertaking would have achieved combined pro-forma sales amounting to US $3.6 billion and income from operations of about US $450 million before nonrecurring items. The acquisition is projected to yield synergies of about US $250 million per year, half of which will be achieved as early as 2001. The augmented product portfolio is expected to provide for additional growth opportunities in several markets.

BASF is a return-focused global company which strives for value-added growth, especially in the sectors of chemistry, health and nutrition as well as oil and gas. The company's product line encompasses high-value-added chemicals, plastics, colorants, dispersions, automotive and industrial coatings, crop protection agents, pharmaceuticals, fine chemicals, oil and gas. The sophisticated integrated-network strategy - the Verbund - is one of BASF's special strengths and it gives the company a decisive competitive edge. With sales of US $29.5 billion in 1999 and 105,000 employees, BASF is one of the world's leading chemical companies. BASF can also be found on the Internet at www.basf.de.

This press release contains certain forward-looking statements and information relating to BASF Group based on current expectations,estimates and projections of its management and information currently available to the company. These statements reflect the current views of BASF with respect to future events, are not guarantees of future performance and involve certain risks and uncertainties that are difficult to predict. In addition, certain forward-looking statements are based upon assumptions as to future events that may not prove to be accurate. We do not assume any obligation to update the forward-looking statements contained in this news release.

 

     
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