Evonik set to reject BASF’s sweetened €11bn takeover bid

Evonik is preparing to reject BASF's improved takeover offer of €24 a share, about €11bn, as undervaluing the company, according to people familiar with the matter. The bid is almost a 40% premium to Evonik's share price before takeover interest emerged in September and is up from an original €22.15 a share that Evonik rejected that month. Evonik could issue a statement in the coming days, and some of the people said it could leave the door open to further talks if BASF raises its offer and clarifies the strategic merits. BASF CEO Markus Kamieth has promised to uphold Evonik's job guarantees until 2032 and argues a combination would help against Asian and Middle Eastern rivals, but says BASF will not pursue a merger 'at any price'. Evonik prefers a standalone strategy that could include acquisitions, job cuts and plant closures, and is among the bidders for US peer Ashland. Any deal hinges on Evonik's biggest shareholder, RAG-Stiftung, whose trustees include North Rhine-Westphalia premier Hendrik Wüst, who faces a state election in April. A combined group would have about €74bn of annual revenue; risks include competing suitors and legacy asbestos litigation. Caveats: the reporting rests on unnamed people familiar with the matter, Evonik declined to comment and BASF and Ashland could not be reached, and the timing and 'door open' stance are hedged.