Cognis comments spark €3.4bn buy-out figure

By Shane Starling

- Last updated on GMT

Related tags Cognis Goldman sachs

Speculation about typical asset valuing ion the chemicals industry by Cognis’s chief financial officer, Marco Panichi, has led to a figure of €3.4bn being attached to the German ingredient company, as buy-out speculation mounts.

BASF is the lead candidate to take control of Cognis from its private equity owners Permira PERM.UL and Goldman Sachs Capital Partners, but BASF remained tight lipped this morning when contacted by

Cognis similarly refused to acknowledge speculation that indicates at least two other suitors have expressed an interest in the company that just turned in its best ever Q1 results.

A handful of independent BASF financial analysts refused to comment on any potential transaction, except Unicreditgroup, who issued a statement recently that said a BASF buy-out would make BASF, the global leader in HPC raw materials”.

The figure was derived after Panichi said companies in the chemicals sector typically traded at between six and 10 times earnings before interest, taxes, depreciation and amortisation (EBITDA) which is €423m.

By multiplying the latest Cognis EBITDA by eight the company was valued at €3.4.

Unicreditgroup said other prospective buyers were Croda and Evonik and valued Cognis at around €3-3.5bn.

No, no, no

Cognis senior communications manager Susanne Sengel said there had been no decision to sell, no IPO offer and no timeline established for any transaction.

Permira PERM.UL and Goldman Sachs Capital Partners have held Cognis for nine years, with BASF touted as a potential buyer since 2006. The Financial Times ​reported recently that BASF had tabled a bid of €3bn, but BASF has refused to confirm or deny the rumour.

Sengel said the ongoing speculation had little effect on the day-to-day running of its operations which include a human nutrition division boasting omega-3s, sterols and vitamins.

In its recent Q1 results, Cognis CEO Antonio Trius said: “All our business units and regions delivered very strong results in the first quarter of 2010. With our innovative products aligned with the wellness and sustainability trends we were extremely well positioned to benefit from improved business conditions. Our company has been able to deliver excellent performance due to our improved product mix, significantly higher capacity utilization and lower operating costs.”

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