BASF considers leather chemicals division sale
09/02/2009
Specialist chemical company BASF said on 4 February that it will consider selling off its leather and textiles chemicals business because of low market growth and high competitive pressure.
The Ludwigshafen-based company said in a statement: “BASF has implemented a series of restructuring and efficiency programs in the past years. However, these measures have not been sufficient to ensure the long-term profitability of the business.”
Hans Reiners, head of the Performance Chemicals division, which includes the leather and textile business, said: “Our employees have worked hard to improve the business in recent years. In view of the difficult market situation, the results are not sufficient to ensure long-term success with our own means.” The business unit has therefore introduced an additional programme to increase efficiency, which is expected to reduce costs by €25 million by 2011.
In addition to implementing this cost-reduction programme, BASF said it was “reviewing future strategic options”. In particular, these include the formation of a joint venture or the complete sale of the business. “The market requires this step, not just because of the fragmented supplier structure and the low market growth,” said Mr Reiners.
BASF operates production plants for leather and textile chemicals in Germany, Spain and Turkey, as well as in Brazil, India and China. The business, which employs approximately 1,300 people, posted global sales of about €400 million in 2007.
Share this story:
