BASF €10.3B Bid Rejected by Rival Evonik Over Valuation

BASF SE has made an ambitious €10.3 billion ($11.7 billion) takeover proposal for German chemical rival Evonik Industries AG, which Evonik promptly rejected as undervalued, according to a report from Yahoo Finance. The unsolicited approach underscores structural consolidation pressures sweeping across Europe's struggling chemical manufacturing sector.

Evonik rebuffed the offer on the grounds that the financial terms were insufficient to merit opening formal negotiations or granting due diligence access to corporate books. The initial buyout proposal was priced at approximately €22.15 per share, which represented a nearly 29% premium to Evonik's trading price prior to public takeover speculation and assigned the company an enterprise value of about €14.2 billion.

Financial Terms and Shareholder Dynamics

The ultimate trajectory of the proposed consolidation will likely depend heavily on the RAG-Stiftung foundation, a prominent state-backed entity that holds a 44% controlling stake in Evonik. The foundation was originally established to fund legacy coal mining liabilities and post-mining obligations in Germany, giving its trustees a decisive voice in any major structural transaction involving the specialty chemicals producer.

Meanwhile, market reaction to the leaked takeover discussions has put immediate pressure on the bidder. BASF investors drove the company's shares down nearly 4% late last week amid mounting concerns over execution risks, potential regulatory hurdles, and the heavy financial burden of absorbing and restructuring a complex peer.

What Is at Stake for European Chemicals

The multibillion-euro bid highlights the acute margin pressures and energy cost disadvantages facing traditional industrial heavyweights in Europe. As high input costs and sluggish domestic demand weigh on legacy chemical producers, larger industry players are increasingly looking toward domestic consolidation to achieve scale efficiencies, even as target boards push back against valuations that fail to capture long-term recovery potential.