Green light from
the EU Commission
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
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
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
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.