BASF, after several weeks of speculation, appears set to acquire Cognis from an investment group that includes the private-equity arms of Goldman Sachs and Permira Advisers. The deal is reported to carry a price tag of $3.7 billion-$4.1 billion and signals BASF’s faith in the continued growth in consumer demand for dietary supplements and high-end nutrition products. While the deal could fall apart in last-minute negotiations, BASF outlasted a higher bid from Lubrizol over the weekend.
Separately, Corn Products International agreed to acquire National Starch in a $1.3 billion deal scheduled to close in the third quarter. National Starch is currently owned by the chemical conglomerate Akzo Nobel and supplies starches and functional ingredients to the food industry.
NBJ Bottom Line
There’s light at the end of the tunnel, at least for international chemical giants looking for a foothold in new economy businesses. The good news here is that large-scale acquisitions are happening in the nutrition industry. Both Cognis and National Starch present their acquirers with opportunities to enter growth markets more in line with the overall direction of the nutrition industry than old economy products such as high-fructose corn syrup (Corn Products) and plastics (BASF). Wellness continues to shape the future of business, even in the chemical industry.
Nutrition Business Journal will provide more detailed coverage of the mergers and acquisitions shaping the nutrition industry in our August issue on finance and investment. Subscribe now through our website to get the whole scoop.
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