German Chemical Majors Reshuffle Businesses

The beginning of 2008 will see new structures for two of Germany's leading chemical producers: BASF and Evonik Chemicals, formerly Degussa.

BASF will structure its businesses in six segments: chemicals, plastics, functional solutions, performance products, agricultural solutions, and oil and gas. Chairman Jürgen Hambrecht says the reorganization is designed to enable the company to focus "even more closely on our customers."

The chemicals group will include inorganics, petrochemicals, and intermediates. Plastics will house styrenics (a business that BASF wants to sell), performance polymers, and urethanes. Functional solution will pull together businesses that primarily supply the automotive and construction industries with catalysts, construction chemicals, and coatings.

Performance products will consist of acrylics and dispersions, formerly part of BASF's styrenics division; performance chemicals; and a new division, care chemicals, that will combine the former fine chemicals division and BASF's detergents and cleaners business.

Agricultural solutions is made up of crop protection products. And the company's oil and gas segment includes its Wintershall subsidiary.

Meanwhile, Evonik's chemicals business is getting a new organizational structure. It's the latest move in the run-up to a planned 2008 stock exchange debut for the company, whose businesses include chemicals, energy, and real estate.

Evonik is consolidating 12 chemical units into six. The reorganization will commence at the beginning of 2008 and is expected to be completed in six months.

"The new structure will make a considerable contribution to more efficiency and market orientation in the group overall," according to a company statement. The structure, the statement says, will ensure "that our businesses have the necessary critical mass in each of their worldwide markets."

The six units will be base chemicals, incorporating C₄ chemistry and building blocks; inorganic materials, combining Aerosil and silanes with advanced fillers and pigments; consumer specialties, combining care and surface specialties with superabsorbers; health and nutrition, amalgamating feed additives with exclusive synthesis and catalysts; coatings and additives, combining coatings and colorants and specialty acrylics; and performance polymers, encompassing high-performance polymers and methacrylates.

Three existing businesses—technology specialties, consumer solutions, and specialty materials—are already highly focused and will not be affected by the restructuring, Evonik says.