BASF Kicks Off Controversial Share Buyback with $7B Coatings Sale
BASF, the world's largest chemical producer, is set to begin a controversial share repurchase program in the first half of 2024. The program is being financed by the sale of its coatings division to US investor Carlyle for a substantial 7 billion euros.
The coatings division, which generates 4.3 billion euros in annual sales and employs over 10,300 people, is expected to be sold in the current quarter. BASF is using the proceeds to accelerate its share buyback program, which has been a contentious topic among shareholders.
BASF's 'Winning Ways' strategy, announced earlier this year, involves divesting non-strategic areas like the coatings division to focus on core competencies. The company is retaining its environmental catalyst business, expecting cumulative cash flows of 4 billion euros by 2030.
In China, BASF's Zhanjiang project is progressing as planned and under budget. Meanwhile, the agriculture division is preparing for an IPO in 2027, further reshaping the company's portfolio.
BASF's share price is currently 18.5% below its 52-week high. An analysis from October 6 provides further insights into whether to buy or sell BASF stock, given the recent developments and the upcoming share repurchase program.
