BASF and Carlyle reach binding transaction agreement on coatings business

The enterprise value of the transaction amounts to €7.7 billion. Subject to customary regulatory approvals, the transaction is expected to close in 2Q26. This transaction, together with the already closed divestiture of the decorative paints business, value BASF’s entire Coatings division at an enterprise value of €8.7 billion and an implied 2024 EV/EBITDA multiple before special items of approximately 13 times. This represents a significant step in unlocking the value of BASF’s standalone businesses, as the company executes its Winning Ways strategy. BASF will also reinvest in the coatings business holding a 40% equity stake and will receive pre-tax cash proceeds of approximately €5.8 billion at closing of the transaction.

BASF Coatings is a global player in the development, production, and marketing of innovative and sustainable automotive OEM and refinish coatings as well as applied surface treatments for metal, plastic, and glass substrates in a wide range of industries. The business operates in Europe, North America, South America, and Asia Pacific, and generated sales of approximately €3.8 billion in 2024.

Working closely alongside management, Carlyle will support the future growth of the business through investing in its commercial capabilities, innovation pipeline, and organisational structure to enhance customer focus. Carlyle will leverage its track record and experience in carve-outs of industrial and chemical assets, following previous investments in Axalta, Atotech, and Nouryon.

“We are delighted to partner with Carlyle, whose sector expertise, carve-out capabilities, and collaborative approach will help position BASF Coatings for long-term success,” said Dr. Markus Kamieth, Chairman of the Board of Executive Directors of BASF SE. “By retaining an equity stake, we are showing our belief in Coatings’ future value creation and upside potential. The passion, expertise, and customer focus of our Coatings team is what makes this business outstanding.”

“The transaction opens a new chapter of opportunity for BASF Coatings, building on today’s success and shaping an even stronger future,” said Anup Kothari, member of the Board of Executive Directors of BASF SE and responsible for the Coatings division.

“QIA is pleased to partner with Carlyle to support the next phase of BASF Coatings’ continued growth,” said Mohammed Al-Sowaidi, CEO of QIA. “This investment aligns with QIA’s approach of investing in industry leaders and is testament to our belief in the long-term resilience of German businesses.”

Business continuity for customers will be ensured throughout the transaction process. In accordance with legal requirements and local practice, employee representatives will be involved.

Read the article online at: https://www.hydrocarbonengineering.com/petrochemicals/13102025/basf-and-carlyle-reach-binding-transaction-agreement-on-coatings-business/