Lonza Might Be Buyout Target

Speculation surfaced at the CPhI conference last week in Madrid that Lonza may be purchased by another player in the fine chemicals sector, perhaps BASF or DSM. But not everyone agrees with that analysis, and Lonza says it's not true.

The talk was spurred by an Oct. 27 report in Börse Online, a German Internet business publication. The report cites "sporadic" Lonza stock-trading activity and an interest on the part of the Blocher family—which owns 19.5% of Lonza shares—in selling its stake as indication that a buyout is possible. Börse Online names BASF or DSM as possible buyers, calling DSM the most likely candidate.

Analyst Peter Pollak, however, says the market capitalization of Lonza is too high for a buyout to go forward. Responding to the report that BASF or DSM would be likely buyers, Pollak—the former head of fine chemicals at Lonza—says, "I give BASF precedence because they have more cash and have indicated they are interested in being a major player in this area." The German firm recently purchased the private Swiss fine chemicals firm Orgamol (C&EN, June 20, page 15).

Stefan Borgas, CEO of Lonza, dismisses all buyout speculation. "Such reports appear frequently," he tells C&EN. "If it were happening, our stock would shoot up and our shareholder structure would change." In fact, Lonza's stock climbed steadily between August and October from $54 to $59. It dropped to about $55 at the end of October and is currently trading at $57.