BASF has announced that it will sell its custom synthesis business, part of its Nutrition & Health division, and parts of its current active pharmaceutical ingredients (APIs) business to Zofingen, Switzerland-based Siegfried Holding.

Following the divestment, for which an enterprise value of €270 million has been named, BASF said it will focus on products for which it has a leading market position.

Siegfried will acquire APIs such as ephedrine, pseudoephedrine and caffeine, with annual sales of around €270 million, while BASF will retain its excipient portfolio and selected APIs, such as ibuprofen, omega-3 fatty acids and polyethylenglycol (PEG).

The transaction, still subject to consultations with employee representatives and approval by regulatory authorities, also includes production sites in Minden, Germany; Evionnaz, Switzerland and Saint-Vulbas, France. All affected employees will be offered transfers.

A syndicate of Swiss banks will handle financing of the handover, and following completion, Siegfried plans to issue a hybrid bond for partial refinancing.

Through the acquisition, the Swiss company will reach the critical size to play a leading role in the supplier market as a recognized partner for the pharmaceutical industry, said CEO Rudolf Hanko. It also "demonstrates the growth potential for the Siegfried Group," he said.

Michael Heinz, BASF managing board member with responsibility for the Performance Products segment, which includes the Nutrition & Health division, said the sale is in line with BASF's strategy of actively managing its portfolio, and it will further sharpen the focus of the Performance Products segment on growth and high margin core businesses."