German chemical giant BASF has agreed to sell a majority share in its automotive coatings division to U.S. private equity firm Carlyle Group for approximately €5.8 billion ($6.7 billion), as part of its broader strategy to streamline operations and focus on core businesses.**
The deal, announced Friday, will see Carlyle acquire a controlling stake in the business, while BASF retains a 40% minority interest. The unit will be carved out into a standalone company, enabling greater strategic flexibility and operational focus.
Carlyle said it views the coatings business as a strong platform for growth, with significant potential to thrive as an independent entity. “We see compelling opportunities to support the team in building a global leader in automotive coatings,” the firm said in a statement.
BASF, headquartered in Ludwigshafen, Germany, has been actively divesting non-core assets amid ongoing efforts to improve profitability and respond to shifting market conditions. The coatings business, though successful, was considered outside of BASF’s long-term strategic focus.
This transaction is one of the largest in the specialty chemicals sector in 2025 and signals continued interest from private equity in acquiring industrial units with stable cash flows and growth prospects.
The automotive coatings unit produces surface treatments and finishes for cars and commercial vehicles, serving major automotive manufacturers worldwide. It has strong market positions, particularly in Europe, Asia, and North America.
Following the deal, which is subject to customary regulatory approvals, Carlyle plans to operate the business as an independent company. BASF’s decision to retain a significant minority stake suggests confidence in the business’s future prospects and provides ongoing exposure to its performance.
This move aligns with a broader trend among multinational corporations to divest ancillary units in order to sharpen strategic focus and unlock shareholder value. BASF has previously stated its intention to concentrate more on its core segments, including chemicals, materials, industrial solutions, and agricultural solutions.
The sale is expected to close in mid-2026.
