By Helena Smolak, Dow Jones
BASF cut its annual dividend and opened the door to shedding noncore assets, including a potential listing of its agricultural-chemicals business, as part of the German chemicals giant’s new strategy.
The company aims to boost earnings and cash generation over the next four years through lower investments and cost savings, after weak demand and high expenses took a toll on profitability in recent quarters.
BASF’s earnings fell under pressure as economic growth slowed in China and Europe as the company was trying to leave behind the hit from Russia’s invasion of Ukraine, which triggered big swings in energy and raw-material costs and forced it to book big writedowns on its assets in Russia.
Five months after taking the helm, Chief Executive Markus Kamieth on Thursday laid out plans to sharpen BASF’s focus on its core operations and said the company would look at options for businesses it considers noncore, which include its battery materials, coatings and environmental catalyst and metal solutions segments as well as its agricultural unit.
BASF aims to complete a legal and resource-planning separation of its agricultural unit that produces seeds, herbicides and fungicides by 2027. The move could pave the way for a potential initial public offering of the business, with the listing of a minority share as an option in the medium term, it said.
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