Week of 19 October 2026 Equity BASF · BAS

Evonik rejects BASF's €10.3bn bid as too low

By Rudy Redshaw, Oliver Prinz, Melis Nurluoglu · Chemicals desk

What happened

On 25 September, BASF confirmed that it recently made a merger proposal to Evonik and its biggest shareholder, the RAG-Stiftung foundation [1]. Sabine Waldeck reported that Evonik had rejected an initial €10.3bn offer, equivalent to €22.15 per share, as too low, although sources suggested BASF could consider a higher bid [2]. With BASF facing growing competition from China’s chemical producers, the potential deal raises a bigger question: can acquiring Evonik strengthen BASF’s competitive position, or will greater scale do little to resolve the cost pressures facing European chemicals?

What people are missing

This acquisition comes at a time when BASF faces fierce competition from China and risks losing its lead in the chemical industry: the chemicals division of China’s Sinopec now generates revenue comparable to BASF’s €59.7bn [3]. This competition has also prompted BASF to invest €8.7bn in a new Verbund site in Zhanjiang, Guangdong Province, which opened on 26 March 2026 as the company’s largest-ever investment and its third-largest site worldwide [4]. The proposed takeover may therefore be an attempt to consolidate the market and defend BASF’s position in the face of rising Chinese competition.

Why it matters

At €10.3bn [5], approximately a quarter of BASF’s market value [6], this would be a major commitment. The timing is also important: BASF is currently restructuring and selling businesses to repair its finances [7], and still expects only around €1.5–2.3bn of free cash flow in 2026 [8]. Financing is therefore key: BASF has not said how it would pay, but a cash offer of this size would most likely be funded largely with debt, putting pressure on BASF’s balance sheet and potentially its dividend. In return, Evonik would increase BASF’s exposure towards specialty chemicals, where earnings are less dependent on price swings than in commodity chemical businesses [9]. Even so, BASF shares fell 3.6% on the day it confirmed the talks [1][5], suggesting investors are not yet convinced the trade-off is worth it.

What we are watching next

The key question is whether BASF returns with a revised offer. BASF’s third-quarter results, scheduled for 28 October 2026 [10], should also provide a useful update on its operating environment as we assess whether a larger group could address the competitive pressures facing European chemical producers [11]. Other factors to watch include the treatment of existing employment commitments, the potential structure of a transaction and any regulatory requirements [3]. With discussions still at an exploratory stage, the next signal to watch is whether both sides can agree on a valuation that makes the deal viable.

Sources

1. BASF — Press Release P-26-172 (25 September 2026)
2. Personal Care Insights — BASF Evonik Takeover Talks
3. RTÉ — BASF Considers Raising Offer for Evonik, Sources Say (9 October 2026)
4. Global Times — BASF Zhanjiang Verbund Site Opens (March 2026)
5. WSAU News/Talk 550 AM · 99.9 FM — Germany’s Evonik Rejects BASF’s $11.7 Billion Bid, Sources Say
6. CIO DE — Paukenschlag in der Chemiekrise: BASF Greift Nach Evonik
7. BASF — BASF Strengthens Its Position in the Market and Achieves Major Progress on Restructuring and Portfolio Measures (July 2026)
8. BASF — BASF Group Releases Preliminary Figures for Second Quarter of 2026 and Increases Earnings Outlook for Full-Year 2026 (July 2026)
9. CHEManager — BASF and Evonik in Merger Talks - Update
10. BASF — Investor Calendar
11. Financial Times — BASF/Evonik Coverage

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