According to M&A information platforms such as Mergermarket and Dealreporter, citing multiple people familiar with the matter, German chemical giant BASF has held preliminary talks in 2026 about a possible merger with specialty chemicals company Evonik.
Deal Is an Acquisition in Nature, with a Wide Gap in Scale
Several sources told Mergermarket that the transaction, externally described as a “merger,” is essentially BASF acquiring Evonik. BASF generated revenue of €59.7 billion in 2025, while Evonik’s revenue in the same period was about €14.1 billion. BASF is more than four times Evonik’s size. If the deal ultimately materializes, it will become one of the largest consolidation deals in the European chemical industry in recent years.
BASF Prioritizes Agricultural Business IPO; Major M&A on Hold
Sources clearly stated that BASF is currently financially stretched and will not launch such a major acquisition before completing the IPO of its Agricultural Solutions business. On September 14, BASF mandated Citigroup, Deutsche Bank, Goldman Sachs and JPMorgan as global coordinators for the IPO. The listing is expected to take place as early as mid-2027. Meanwhile, BASF is advancing large-scale business restructuring, including reducing its net debt level. Against this backdrop, pursuing another large M&A deal would mean the company needs to make a sizable additional capital expenditure decision.
Evonik Advances Restructuring in Parallel; Asset Structure May Change Before Any Deal
News of potential contact between BASF and Evonik coincides with Evonik entering a large-scale restructuring phase. Evonik has announced the next phase of its restructuring plan, spanning 2027 to 2029, including the sale of its Oxeno and Syneqt businesses, which together employ about 4,300 people. Evonik has already begun talks with potential investors for Oxeno, while the sale process for Syneqt is planned to start in 2027.
Since 2024, Evonik has continued to push forward with its group transformation, including reducing management layers, cutting costs, and further focusing on its core specialty chemicals business. This means that regardless of whether further negotiations take place between BASF and Evonik, Evonik’s asset and business structure may change significantly before any large M&A transaction actually materializes. Evonik interim CEO Claus Rettig reiterated after the September 22 strategy meeting that the company will continue restructuring amid the industry crisis: “We will use this multiple crisis to change old structures and put ourselves in a more favorable position.”
RAG Foundation’s 44% Stake Makes Its Position a Key Variable
If BASF really considers acquiring Evonik, RAG-Stiftung will be a key party. Currently, the foundation holds about 44% of Evonik’s shares and is Evonik’s largest single shareholder. RAG Foundation uses its assets to fund long-term obligations left after Germany’s hard coal mining exit. Its Evonik stake has long been an important part of the foundation’s investment assets.
At the same time, RAG Foundation has for some time been pursuing a gradual and smooth reduction of its Evonik shareholding, with a long-term target of reducing its stake to 25.1%. However, as of now, no information confirms that the foundation and BASF have reached an agreement or engaged in related negotiations.
Antitrust Review Will Be Inevitable
BASF itself lists Evonik as one of its major global competitors. Their businesses overlap in multiple specialty chemicals areas, including additives, raw materials for industrial applications, and some nutrition and care businesses. Therefore, if the deal ultimately takes shape, it will inevitably require a comprehensive antitrust review. Which regulator is responsible will depend on the specific structure of the transaction and the two companies’ turnover in different regions. Under current EU merger control rules, for large corporate mergers that meet the relevant thresholds and have cross-border impact, the European Commission may have jurisdiction.
Industrial Policy Implications
BASF is Germany’s largest chemical company, while Evonik is one of the world’s important specialty chemicals producers. Both companies have major production sites in Germany and face high energy and production costs, global overcapacity, and increasingly fierce competition from Asia, North America and the Middle East. Therefore, if the two companies really integrate, the market’s focus will also involve production site layout, future investment, and the structure of the European chemical industry.
Analysts believe that acquiring Evonik fits the current major trend of consolidation in the European chemical industry. BASF’s recent moves have already created conditions for such consolidation. The Zhanjiang Verbund site officially began production in March 2026, both stabilizing its position in the Chinese market and freeing up space for adjustments to its domestic business. In June of the same year, BASF’s coatings business was sold to Carlyle Group at an enterprise value of €7.7 billion and completed closing, demonstrating its ability to carry out large-scale asset restructuring. Acquiring Evonik could help BASF improve operating efficiency in Germany and stabilize its business scale. The EU’s new merger guidelines give companies greater operational room than the old rules. At the EU level, there is an intent to cultivate domestic champions with scale advantages and enhance industrial resilience. Companies can use responding to global capacity competition as an argument for the deal’s rationale in merger review.
Deal Still at an Early Stage, with Significant Uncertainty
Multiple sources mentioned that the idea of a BASF-Evonik merger is not new. The topic reached the boardroom years ago, and the concept has even been discussed for nearly 20 years, long remaining at the concept stage. The report also stressed that the current talks remain at a preliminary stage and that no substantive agreement has been reached. As of Tuesday, BASF, Evonik and RAG Foundation had not officially confirmed the existence of an acquisition offer or any related transaction agreement.
