OCTOBER 10,2025

BASF to Exit Global Coatings Business with Potential Sale to Carlyle, While Accelerating Investments in China

Hz info2025-10-10 10:13

Hz info:According to media reports, German chemical giant BASF is planning to sell its coatings business to U.S. private equity firm The Carlyle Group, with the transaction valuation reportedly reaching 7 billion euros (approximately 8.17 billion U.S. dollars) — higher than the previous market estimate of 6 billion euros (around 7 billion U.S. dollars). If the transaction is finally completed, BASF will fully withdraw from the coatings business it has long operated, marking a key step in the company's business restructuring strategy.
Between May and June 2025, BASF hired Bank of America and JPMorgan Chase as financial advisors, distributed information memorandums to potential global buyers, and officially launched the bidding process. BASF then selected bidders for the next round and requested final offers by August; market sources indicated that the valuation might exceed 6 billion euros.
It is reported that BASF's Coatings division is of considerable scale, employing over 10,300 people and focusing on three core areas: automotive original equipment manufacturer (OEM) coatings, automotive refinish coatings, and decorative coatings & surface treatment. As one of the world's largest suppliers of automotive OEM coatings, it provides coating solutions for the new vehicle production lines of numerous automakers; its decorative coatings & surface treatment business covers industrial application coatings and metal pretreatment products. In 2024, the division achieved sales of 4.28 billion euros (about 4.4808 billion U.S. dollars or 32.21 billion yuan), a year-on-year decrease of 2.4%. Nevertheless, it still accounted for 6.6% of BASF Group's total sales, making it a significant business unit.
BASF's plan to spin off its coatings business began in September 2024, when the company released a new "Focus on Core" strategy, marking the coatings business as a "non-core asset" and initiating the spin-off evaluation phase. On February 17, 2025, Sherwin-Williams announced the acquisition of BASF's decorative coatings business in Brazil through an all-cash transaction worth 1.15 billion U.S. dollars. In 2024, this business generated approximately 525 million U.S. dollars in sales for BASF, boasting an extensive portfolio of coatings, coating preparation products, and digital solutions, with operations almost entirely in Brazil. The transaction was completed on October 1, 2025, becoming the largest single M&A deal in the global coatings industry in 2025 so far. It includes two production sites in Demarchi and Jaboat？o, relevant contracts, brands such as Suvinil and Glasur, and approximately 1,000 employees.
Despite the potential change in ownership of BASF's global coatings business, its investment in the Chinese market has not slowed down.
On March 24, 2025, BASF announced the official commissioning of the polyester and polyurethane resin production line expansion project at its Caojing Base in Shanghai. The annual production capacity of the relevant resins has increased from 8,000 tons (when the base was initially built in 2015) to 18,800 tons, doubling the capacity. In addition to this resin capacity upgrade, BASF also plans to further expand the production capacity of electrophoretic emulsions and grinding resins at the Caojing Base through process optimization by the beginning of 2026. This strategic move will strengthen the company's supply capacity in the Asia-Pacific automotive coatings sector and provide stable support covering the entire coating process for regional automakers (OEMs) and auto parts manufacturers over the next decade.
Zhao Zhengyu, Senior Vice President of BASF and Head of Global Automotive OEM Coatings Solutions, stated: "The expansion of resin production capacity and the future optimization of electrophoretic emulsion production lines represent another important milestone in BASF's continuous deepening and innovation in the Asia-Pacific market. This will significantly enhance the resilience of our local supply chain and ensure that we can quickly respond to the needs of Asian customers. We remain committed to fulfilling our long-term promise of rooting in and serving the market through localized production and technological innovation."
BASF has established a production base matrix for coatings and raw materials in China, with Shanghai, Zhanjiang, and Nanjing as the core, radiating across the country. It is strengthening supply chain resilience through capacity expansion and technological upgrading. As BASF's largest overseas investment project globally, the 80,000-ton annual neopentyl glycol plant at the Zhanjiang Integrated Base is expected to be commissioned in the fourth quarter of 2025. The Nanjing and Chongqing bases are further consolidating their advantages in polyurethane coating raw materials through capacity expansion.

Supported by a multi-level R&D system, BASF has deeply integrated global technological advantages with the needs of the Chinese market, building an innovation closed loop from basic research to application implementation. The Innovation Campus in Shanghai, as BASF's largest R&D base in the Asia-Pacific region with a total investment of approximately 280 million euros, has formed a complete R&D chain covering coating raw materials, formula optimization, and environmental protection technologies after multiple expansions. Meanwhile, BASF continues to deepen its localized service capabilities. The Jiangmen Asia-Pacific Application Center, as an important node in the global refinish coating technology network, is equipped with a full set of spraying and testing equipment, capable of providing complete process solutions from sanding to post-treatment, focusing on serving customers in China and the Asia-Pacific region.

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Notably, in the process of accelerating its localized layout in China, BASF has actively established in-depth cooperation with local enterprises. In March 2025, the company successively signed strategic cooperation agreements with Li Auto and NIO, conducting innovative cooperation in low-carbon emission material technology and electric vehicle exterior coating technology respectively. In addition, on September 27, 2025, BASF Coatings and SAIC-GM-Wuling jointly launched the new Bingo S series models. These models adopt the full coating solution provided by BASF, covering electrophoresis, intermediate coating, basecoat, and clearcoat. With better quality and more diverse color options, they meet the increasingly diversified consumer demands in the Chinese market, fully demonstrating BASF's ability to help local partners enhance product value through cutting-edge technologies.


DisclaimerThe Institute of Plastic Research makes every effort to ensure the accuracy of the information, reliability of the data, and objectivity and fairness of the content and viewpoints described herein. However, we do not guarantee the accuracy and completeness of the information. Any losses or legal consequences resulting from actions taken based on this information are the sole responsibility of the individual undertaking them.

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