BASF Gets U.S. "OK" for Takeda Merger

WASHINGTON--The Antitrust Division of the U.S. Department of Justice reportedly had no objections to the proposed merger of Takeda Chemical Industries with BASF AG, according to the companies. BASF, based in Ludwigshafen, Germany, initiated the merger proceedings for Osaka, Japan-based Takeda in July. The European anti-competition agencies still need to give their approval to the deal.

According to BASF, when approved, the merger will create a global market for its vitamin business with a built-in market share of approximately 30 percent. It will also enable the company to provide a full range of vitamins to its customers. BASF logged US$500 million in vitamin sales [as part of its Fine Chemicals division] in 1999. Takeda's 1999 sales totaled US$240 million.

Terms of the agreement include a transfer of certain business assets [including Takeda Vitamin & Food USA Inc. and its subsidiary , Takeda Canada Vitamin and Food Inc.; Takeda Europe GmbH; and Takeda Vitamin & Food Asia Pte. Ltd.] from Takeda to BASF and the formation of a joint venture for selling bulk vitamins in Japan. BASF will hold a 66-percent stake in that venture; Takeda will hold 34 percent. BASF will inherit Takeda's process technology and business patents for B1, B2, B6, C and folic acid. BASF will also be responsible for the marketing of products sold outside of Japan.

The proposed merger is the result of a US$600 million investment program initiated by BASF. Its goal is to increase its capacity for producing bulk vitamins.

"It is truly significant that we will form a global alliance with BASF," said Hiroshi Uchiyama, president of Takeda Vitamin and Food. "I am confident that the integration of both companies' bulk vitamins businesses will expand the product range and business operations leading to additional business growth."

According to Stephan Reintgen, director of human nutrition at BASF and the team leader on this project, there is no precise date for the European authorities' approval. Each authority has different timelines; however, he reported, approval is expected within the next few months.

He noted that the U.S. document said, essentially, that the waiting period is over and it had no objections. Now, he said, the companies can legally fulfill what they intend to do. However, he added, "There will be no closing on the merger until all authorities' approval in the major regions is secure," he added.

For more information, visit www.basf.com or www.takeda.com.