BASF has found a buyer for its global pigments business in Japanese chemicals and plastics producer DIC. The deal, which foresees the activities changing hands for €1.15 billion on a cash and debt-free basis is expected to close in the fourth quarter of 2020, following regulatory approvals.

In February of this year, BASF announced plans to quit the business that employs around 2,600 people globally and reported annual sales of about €1 billion in 2018.

Founded in 1908, the Tokyo-headquartered group, which traditionally has a strong position in printing inks, employs some 20,000 people globally. Active in more than 60 countries, it had and had sales of around 800 billion yen (€6.8 billion) in 2018. 

DIC is active in three segments: Packaging & Graphics, Functional Products and Color & Display. The latter includes a portfolio of pigments.

“We have achieved our goal to find an owner who considers pigments a core strategic business,” says Markus Kamieth, member of BASF managing board with responsibility for the Industrial Solutions segment. Kamieth said DIC plans to further develop the business in the “coming years.” 

Kaoru Ino, president and CEO of DIC, said management has outlined a “clear growth path” up to 2025, targeting an increase in annual sales to 1 trillion yen (€8 billion). “In this context,” he said “BASF’s pigments portfolio is an important strategic addition.” This will allow the Japanese player “to expand its position as one of the leading pigment suppliers globally.”

The DIC pigments business is operated by group crompany Sun Chemicals, based in Parsippany, New Jersey, close to BASF’s US headquarters. Its CEO, Myron Petruch, said that as a long-standing business partner of the German chemical giant “we value the expertise and engagement of BASF’s employees.”

The transaction partners did not comment on whether all employees will transfer to the new owner. BASF is in the throes of a restructuring process that will see 6,000 jobs eliminated worldwide, the lion’s share in Germany.