FINANCIAL TIMES: Basell suitors make joint offer: “Four private equity firms have teamed up to make a joint bid for Basell, the petrochemicals business owned by BASF and Royal Dutch/Shell. The offer could value Basell at about €4bn ($5.2bn).”: “The company has promised to spend $15bn a year on capital investment as it looks to recover from last year's reserves scandal.” (ShellNews.net) 13 Jan 05
By Lina Saigol and James Boxell,
Four private equity firms have teamed up to make a joint bid for Basell, the petrochemicals business owned by BASF and Royal Dutch/Shell. The offer could value Basell at about €4bn ($5.2bn).
Blackstone and Apollo partners, which previously submitted a joint bid for the business, joined forces with Bain Capital and Goldman Sachs Capital Partners, which had also bid jointly for Basell, according to people close to the auction.
BASF, the world's largest chemicals company by sales, is also understood to have received bids from Ineos Chlor, a privately owned European producer of chlor-alkali metals.
National Petrochemical Company of Iran is also understood to have submitted a bid on Wednesday.
The sale of Basell is part of Shell's plans to dispose of $12bn of non-core businesses in the next three years.
The company has promised to spend $15bn a year on capital investment as it looks to recover from last year's reserves scandal.
Shell was forced to cut its level of proved oil reserves by 23 per cent, which led to the removal of its three most senior executives.
The company's new management team, headed by Jeroen van der Veer, chief executive, has been forced to check the reserves again, which is expected to lead to yet more cuts.
Analysts have warned that the company will probably need to make acquisitions to help it catch up with industry peers because of the difficulty in finding oil and gas and gaining access to energy- producing countries such as the Middle East states or Russia.
Industry rivals such as BP, ExxonMobil and Total of France have far superior production and reserve replacement targets for the next few years.
Mr Van der Veer left open the door to significant acquisitions at a private speech to Shell's 100 top executives in the Hague in December. Some analysts suggest the company could be interested in making a bid for Unocal, the US independent oil company in which CNOOC, the Chinese state- controlled oil group, has shown an interest.
It has also been linked constantly with BG Group, its smaller UK gas rival.
In November, John Feldmann, BASF board member and divisional head, said the group was preparing for an initial public offering of Basell as an alternative to an outright sale. People familiar with the situation said a stock market listing now seemed unlikely.
Lazard and CSFB are advising BASF and Shell on the sale.
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