BASF Successful in Bid for U.S. Chemical Firm

Chemical company Engelhard Corp. abandoned months of resistance Tuesday and agreed to a $5-billion takeover from German rival BASF.

Engelhard’s management decided to back BASF’s twice-sweetened offer of $39 a share for the Iselin, N.J.-based company and would recommend that its shareholders accept it, the companies said.

Including debt, the deal is worth about $5.6 billion.

BASF has said the deal would create a world player in chemical products such as pigments and catalysts.

“This is a crucial step toward our goal of acquiring Engelhard,” BASF Chief Executive Juergen Hambrecht said. “We are confident that Engelhard’s shareholders will tender their shares.”

Engelhard Chairman and CEO Barry Perry said the offer “provides fair value to our shareholders, and the agreement paves the way for an orderly and cooperative transaction.”

Engelhard said it would write to shareholders and urge them to accept the offer. Engelhard spokesman Ted Lowen said the company had postponed Friday’s annual shareholder meeting until June 30.

BASF’s U.S.-traded shares fell $1.86, or 2.3%, to $80.98. Engelhard shares rose 25 cents to $38.93.