BASF to Take Henkel’s Construction Chemicals
In a move to strengthen its construction chemicals business, BASF has agreed to acquire Henkel’s flooring, tiling and waterproofing activities in western Europe. The acquisition includes Henkel’s Thomsit flooring brand, as well as its Ceresit flooring, tiling and waterproofing business. The two firms have agreed that BASF will have the right to use the Ceresit trademark in western Europe for tiling and waterproofing products, which have their main markets in Germany and Benelux.
Ralf Spettmann, president of BASF’s Construction Chemicals division, said the PCI and Thomsit brands will make the Ludwigshafen group one of the leaders in the German market for flooring products, and the Ceresit business will allow it to enter market segments which it currently does not serve comprehensively.
Total revenue for the Henkel businesses is said to be in the “higher double-digit million euro” range. BASF will merge the activities into its wholly owned subsidiary PCI Group, part of its Construction Chemicals division. PCI has a leading position in the German market for tile fixing systems, according to BASF.
Included in the proposed transaction is a temporary lease of Henkel’s site in Unna, Germany. BASF will operate the site for two to three years, then intends to continue production at its existing PCI sites, mainly in Hamm, near Unna.
Hermann Deitzer, head of Henkel’s Consumer, Craftsmen and Building business and corporate senior vice president, said building materials will remain an integral part of the company’s portfolio, and it will continue to develop its activities in all other regions. He said the Ceresit brand will continue to be the strategic platform for Henkel’s global building material business, adding that in western Europe, “we do not see a long-term perspective for this business in its current setup as well as for our related activities in Unna.”
The transaction is expected to close by the end of 2016, subject to antitrust approval. The parties have agreed not to disclose financial terms.
BASF said it intends to offer Henkel employees mid- or long-term employment wherever possible.