BASF and Engelhard reach agreement

May 31, 2006 — BASF (NYSE: BF) and Engelhard (NYSE: EC) jointly announced that they have signed a definitive agreement for BASF to acquire all the outstanding shares of Engelhard for $39 per share in cash. Including stock options, that gives the transaction a total net equity value of about $5 billion, according to an Engelhard release. A previous deal for 20 percent of the company is being withdrawn.

Engelhard’s board of directors unanimously approved the agreement and recommended Engelhard shareholders tender their shares into BASF’s offer.

“We are very pleased that BASF and Engelhard were able to reach agreement on a negotiated transaction,” said Jurgen Hambrecht, chairman of BASF’s board of executive directors, in a written statement.

“Our board has determined that the $39 per share offer provides fair value to our shareholders, and the agreement paves the way for an orderly and cooperative transaction,” said Barry Perry, Engelhard’s chairman and chief executive officer, in a written statement.

Engelhard is a surface and materials science company that develops technologies to improve products and processes. It is based in Iselin, New Jersey. BASF is a chemicals company based in Ludwigshafen, Germany.

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