German chemical giant BASF SE, facing a changing landscape in the
wake of Dow Chemical Co.'s $18 billion purchase of Rohm and Haas Co. and Ashland Inc.'s $3.3 billion buy of Hercules Inc., is reportedly considering an acquisition of W.R. Grace & Co. out of bankruptcy.
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The Financial Times Deutschland reported Wednesday that BASF, with a solid balance sheet and an appetite for growth, is also looking at U.S.-based Rockwood Chemical and Cognis GmbH of Germany. Company officials declined comment, but earlier in July CEO Juergen Hambrecht told investors he expects more consolidation in the chemicals sector.
BASF is no stranger to dealmaking, having spent nearly $10 billion in 2006 to acquire catalyst maker Engelhard Corp. as well as the construction chemicals business of Degussa AG, CropDesign NV and resin maker Johnson Polymer.
A sale would be a fitting final chapter for Columbia, Md.-based W.R. Grace, which was founded in the 1850s by Irish immigrant and one-time New York Mayor William Russell Grace. The company over the years transformed itself from a shipping firm to chemicals, and for a brief time held a majority stake in Miller Brewing Co.
But its more recent history has been full of potholes, including asbestos claims and a water contamination suit that was the basis of the movie "A Civil Action." Grace filed for Chapter 11 in April 2001 to help deal with its more than $1 billion in asbestos liabilities and various Environmental Protection Agency fines. - Lou Whiteman
See TheDeal.com story on two big chemicals deals in two days
See FT Deutschland report on BASF (in German)
See Reuters story with Juergen Hambrecht's comments
See TheDeal.com story on BASF's 2006 dealmaking
